THE VARIED FORMS OF CORRUPTION

Abuse of Functions : Abuse of functions refers to a public employee or public office holder that is doing something which is illegal or something that the official has no legal authority to do, in order to obtain a personal economic benefit or cause an illegal damage to others. One sort of abuse of office is the misuse of information. That is, if an official, in reliance on information which she/he has acquired by virtue of her/his office, speculates on the basis of this information or acquires a pecuniary interest in any property, transaction or company which might be affected by such an action or information or helps another to do any of these actions.

Agent: Under the OECD Convention, it is a criminal offence for any person intentionally to offer, promise or give any undue pecuniary or other advantage, whether directly or through intermediaries, to a foreign public official, for that official or for a third party, in order that the official act or refrain from acting in relation to the performance of official duties, in order to obtain or retain business or other improper advantage in the conduct of international business.

Blackmail: Blackmail is the crime of threatening to reveal potentially damaging information about a person to the public, a family member, or associates unless a demand upon the victim is met. This information is usually an embarrassing, socially damaging, and/or criminally incriminating nature. Blackmail is similar to extortion. The difference is that extortion involves an underlying, independent criminal act, while blackmail does not.

Breach of trust: Breach of trust refers to abuse of power, or failure (whether or not such failure was deliberate, dishonest or negligent) to carry out the general or fiduciary duties of a trustee. Trustees are personally liable for any loss to the trust caused directly or indirectly by the breach, and must hand over (to the trust) any profit made from the breach (whether or not the trust suffered any loss).

Bribery: Under the OECD Convention, bribery is to offer, promise or give any undue pecuniary or other advantage, whether directly or through intermediaries, to a foreign public official, for that official or a for a third party, in order that the official act or refrain from acting in the performance of official duties, in order to obtain or retain business or other improper advantage. Bribery occurs during an interaction between two parties. Both the giving and receiving party of the bribe commit a crime.

Conflict of Interest: A conflict of interest exists when someone, such as a public official, has competing professional obligations or personal or financial interests that would influence the objective exercise of her/his duties.

Cronyism: Cronyism is a form of favouritism shown to close friends. A typical situation of cronyism would be the political appointment to office of a friend without regard for her/his qualifications.

Demand Side/Passive Bribery: The solicitation or acceptance by a public official, directly or indirectly, of an undue advantage, for the official himself or herself or another person or entity, in order that the official act or refrain from acting in the exercise of his or her official duties. Typical forms of demand side bribery are often related to: Denial of goods or services; Access to utilities; Access to licences; Legal sanctions; Physical threats; Lost opportunities.

Embezzlement: Embezzlement is the fraudulent appropriation of money or property by a person entrusted to safeguard the assets in another’s interests. Embezzlement can be committed by a person entrusted with private or public resources.

Extortion: Extortion is the unlawful use of one’s position or office to obtain money through coercion or threats. One example would be when customs officials request undue ‘customs duties’ from importers as a condition to clear their goods.

Facilitation Payments: Facilitation payments are a form of bribery made with the purpose of expediting or facilitating the performance by a public official of a routine governmental action and not to obtain or retain business or other undue advantage. Facilitation payments are typically demanded by low level and low income officials in exchange for providing services to which one is legally entitled without such payments. A distinction is generally made between facilitation payments and outright bribery and corruption. In some countries, it may be considered normal to provide small unofficial payments under certain circumstances, although this practice is illegal in most countries. Small facilitation payments do not constitute payments made to obtain or retain business or other improper advantage and, accordingly, are also not an offence. Such payments, which, in some countries, are made to induce public officials to perform their functions, such as issuing licences or permits, are generally illegal in the foreign country concerned.

Fraud: Fraud is a criminal offence in most jurisdictions. It involves the use of deception, trickery and breach of confidence to gain some unfair or dishonest advantage.

Gifts: In the context of corruption, a gift is a financial or other benefit, offered, given, solicited or received with an obligation to provide any benefit in return. Gifts and hospitality may be used to facilitate corruption, or may give the appearance of corruption. Gifts may include cash or assets as presents, and political charitable donations. Hospitality may include meals, hotel flights, entertainment or sporting events.

Graft: Graft is a form of political corruption in which an official acquires financial gain by dishonest or unfair means, especially through the abuse of one’s position or political influence. Unlike bribery, graft does not require that the official actually provided an undue advantage; it is enough that she/he gains something of value apart from her/his official pay when doing her/his job.

Kickbacks: A kickback is a bribe to obtain an undue advantage, where a portion of the undue advantage is ‘kicked back’ to the person who gave or is supposed to give the undue advantage. The payment of kickbacks is a corrupt practice which typically occurs in connection with public procurement process when a company pays a procurement officer to illegally award the contract to the company in return for a bribe.

Nepotism: Nepotism is a form of favouritism shown to family members without regard to merit. An example of nepotism is the appointment of family members to civil service, often at the expense of a more qualified person.

Patronage: Patronage is a system in which political supporters are rewarded for their support, such as being appointed to public office or receiving contracts, subsidies or other benefits.

Petty Corruption: Petty corruption refers to the everyday corruption taking place at the implementation end of public services when public officials meet the public. Sometimes it is referred to as ‘routine’ corruption, whereby, for instance private importers of goods pay bribes to obtain a speedy completion of routine customs procedures, or whereby import goods with high customs duties and excise rates are classified as goods with lower rates. Petty corruption can also be described as ‘survival’ corruption, a form of corruption which is pursued by junior or mid-level revenue officers who may be grossly underpaid and who depend on taking relatively small, but illegal payments to feed and house their families and pay for education. The distinction between petty corruption and facilitation payments is difficult to draw in practice. Theoretically, the difference is that petty corruption gives the person paying a bribe an undue advantage, whereas a facilitation payment only gives access to a service that would otherwise be legally provided without the payment. Generally, both practices are illegal.

Supply Side/Active Bribery: The promise, offering or giving, to a public official, directly or indirectly of an undue advantage, for the official himself or herself or another person or entity, in order that the official act or refrain from acting in the exercise of his or her official duties. The typical forms of supply side bribery, apart from direct payments are: Gifts and travels; Various donations and contributions to political parties.

Trading in Influence/Influence Peddling: Trading in influence occurs when a person who has real or apparent influence on decision-making of a public official exchanges this influence for an undue advantage. There are demand and supply sides of this offence. A briber is guilty of the offence if she/he offers, promises or gives an undue advantage to a person in order that the recipient exerts her/his influence on the decision,-making of a public official. An influence peddler is guilty if she/he requests, solicits, receives or accepts an undue advantage from a person in order that she/he exerts influence on the decision-making of a public official. The UN Convention Against Corruption (UNCAC) Article 18 mandates the criminalisation of ‘trading in influence’ when this is committed intentionally and defines such conduct as follows: (i) The promise, offering or giving to a public official or any other person, directly or indirectly, of an undue advantage in order that the public official or the person abuse his or her real or supposed influence with a view to obtaining from an administration or public authority of the State Party an undue advantage for the original instigator of the act or for any other person. (ii) The solicitation or acceptance by a public official or any other person, directly or indirectly, of an undue advantage for himself or herself or for another person in order that the public official or the person abuse his or her real or supposed influence with a view to obtaining from an administration or public authority of the State Party an undue advantage.

Undue Advantages: Refers to something to which the company or person concerned was not clearly ore legally entitled, such as an operating permit for a factory which fails to meet statutory requirements.