Australia

This chapter considers Australia as a host for the proceeds of foreign grand corruption, and addresses the common instances in which inward corruption flows have attracted scarce publicity and little or no investigation, and where the host country government has been resistant to the idea of tracing, freezing, and returning looted wealth from abroad. People too often hear about the atypical anti-corruption success stories, while the more typical stories of corrupt leaders being able to enjoy their loot undisturbed are overlooked. The chapter argues that this lack of effectiveness is a result of a lack of willingness to take action rather than a lack of capacity. Australia has some of the most powerful applicable laws in the world, more stringent than those available to its American, Swiss, and British counterparts, but the authorities have lacked the inclination to apply them.

The United States

This chapter begins by tracing the origins of the anti-kleptocracy cause in the United States, starting with the harsh Cold War environment and the Foreign Corrupt Practices Act of 1977. It explores the status quo ante of dictators being able to launder their funds in the US financial system with impunity immediately before and after the turn of the century. At this time, there was no law prohibiting American banks and other institutions receiving the proceeds of foreign corruption. The USA Patriot Act closed this legal loophole, yet practice lagged, and laws at first failed to have much of an impact. More recent cases indicate at least partial effectiveness, however, with instances of successful prevention and some looted wealth confiscated and returned.

Introduction

This introductory chapter discusses the concept of grand corruption or kleptocracy (“rule by thieves”). It particularly focuses on instances of corruption committed by senior public officials involving large sums of money that are held in a foreign country. There is an international moral and legal responsibility for states to prevent the proceeds of foreign corruption offenses from entering their financial systems and, to the extent that such illicit wealth does filter through, to trace, freeze, and return it to the source or “victim” country. Ultimately, the campaign against grand corruption by states, intergovernmental organizations, and NGOs is centered on an extremely delicate issue. This campaign is in tension with fundamental laws and norms of sovereign immunity, and focuses on the powerful countries that are most resistant to outside political pressure.

Switzerland

This chapter traces how Switzerland has historically attracted such a huge share of foreign wealth. The coverage of kleptocrats' wealth in Switzerland and the various efforts to recover it is roughly divided into three sections. The first deals with the examples of Marcos of the Philippines, Abacha of Nigeria, and Montesinos of Peru over the period 1986–2005. The second part considers some failures, with coverage of “Baby Doc” Duvalier (Haiti), and Benazir Bhutto and Ali Asif Zardari (Pakistan). The third section analyzes the Arab Spring cases, with a brief mention of others involving incumbents in Uzbekistan and Malaysia, to assess the effects of preventive and remedial policy reforms introduced in response to earlier scandals.

The Rise of the Anti-Kleptocracy Regime

This chapter elaborates on the concept of kleptocracy by providing a portrait of one of the most publicized and influential early examples of grand corruption: that of Mobutu Sese Seko in the Congo. Sketching out the corruption of Mobutu and his clique shows how the global anti-kleptocracy norm and the resulting regime came into being. For different reasons, a wide variety of intergovernmental organizations, NGOs, and governments from Africa, Asia, and Latin America argue that corruption implicates rich countries as well as poor, because funds looted from poor countries tended to end up in rich ones. The story of intertwined normative and policy change at the global level in this chapter provides context for the following analysis of how well these rules work at a national level.

Conclusion

This concluding chapter compares the patterns of strengths and weaknesses among the previous case studies and provides some policy recommendations. It explains that, given the inherent difficulty of international legal action, the problems faced by victim countries, which almost by definition have limited resources, and the fact that even “bad guys” are allowed due process and human rights in rule-of-law democracies, it seems that asset recovery as a purely criminal law strategy will seldom work. A more hopeful strategy is to move away from the criminal justice system and interstate law, and instead use a mix of strategies pursued by states as well as non-state actors, from NGOs, to vulture funds, to private individuals.

The United Kingdom

This chapter examines the experiences of the United Kingdom in hosting, tracing, and returning the proceeds of grand corruption from abroad. Public top-level political commitment to the anti-kleptocracy norm has translated into only very partial policy effectiveness. The British government then took a close interest in the issue of asset recovery subsequently at home and in multilateral settings. It instituted a program that may serve as something of a model for other countries to follow, whereby development aid money is used to track down looted assets in London. The chapter explains that a sincere normative commitment by successive prime ministers to development-related campaigns against international corruption has led to important and innovative policies to track foreign kleptocrats' wealth in Britain.