December 9 2015

 

by Jean Pesme

The Fourth Arab Forum on Asset Recovery, which is hosted by Tunisia and co-chaired by Germany and Qatar, coincides with this year’s International Anti-Corruption Day. Representatives from thirty countries, international bodies and civil society organizations are attending.

Interest in asset recovery includes and extends far beyond the Arab World. In just the past few months, we have witnessed how the issue has garnered even greater international attention. 

Last month at the sixth session of the Conference of the States Parties to the United Nations Convention Against Corruption (UNCAC), asset recovery took center stage.

Ten years after the entry into force of UNCAC, the discussions in the plenary and in many side meetings in St Petersburg, were testimony of how much the recovery of stolen assets is genuinely a ‘fundamental principle’ of the UN Convention. They also highlighted how much remains to be done to translate aspirations and commitments into action. This strong attention to asset recovery reflects the original “contract” between the States’ parties to the Convention –notably between advanced economies and developing countries.

The agreement by the Conference of the States Parties to launch the second round of reviews of States’ parties, which will include a focus on the asset recovery chapter of the Convention is a major milestone. Unique to this UN Convention, the roll out of the second cycle of peer reviews will be critical to both sustaining the political momentum around asset recovery, and also shedding further light on what works and what does not work in global and domestic asset recovery efforts.

The StAR Initiative has been at the forefront of both discussion and action on this issue. At the meeting in St Petersburg, StAR organized a day-long side event, looking at progress on asset recovery since the last session of the Conference two years earlier. Discussions took place against the backdrop of StAR and the OECD’s “Few and Far” analytical work, which highlights how little has been recovered against estimates of stolen assets. In light of this significant gap, the report puts forward recommendations for action based on the most recent good practices.

Debates focused on steps to be taken by requesting countries as well as actions by financial centers to trace, confiscate and return such assets.  They addressed the imperative of ‘proactive action’ to prevent, detect and confiscate stolen assets – in particular in advanced economies where they are typically laundered. This requires actions that include - amongst others - the use of all channels of international cooperation beyond mutual legal assistance, and all tools to recover assets beyond criminal confiscation.  While noting some recent progress in specific cases, the discussions also highlighted the many remaining challenges, not least in terms of identifying stolen assets, linking them to individual offences and determining their beneficial owners.

One significant change for asset recovery is the way in which it has recently been framed in the broader context of development and, in particular, the Financing for Development work. Many delegations stressed how the 2030 Sustainable Development Goals (Goal 16.4) and the Addis Ababa Agenda for Action of the Third International Conference on Financing for Development bolstered the case for more concrete action in the pursuit of stolen asset recovery.

Overall, it is clear that the gap between aspirations and commitments and actual recovery remains a source of significant frustration. The discussions around the draft asset recovery resolutions submitted respectively by the United States, and Nigeria along with South Africa (on behalf of the African Group) crystallized the argument.

At stake are two mutually reinforcing perspectives on how best to deliver results on asset recovery. The first concerns how to prevent outflows of proceeds of corruption. Should it be undertaken by actions in developing countries or by preventing money finding its way to safe havens in advanced economies – or both?

The second perspective looks at who bears primary responsibility for stepping up confiscation and return of stolen assets. Some of the related challenges are analyzed in a report by StAR, ‘Left Out of the Bargain’, which deals with the contentious issue of whether and how foreign bribery related settlements in advanced economies could involve affected developing countries, for better anti-corruption and asset recovery results.

By ultimately adopting two asset recovery resolutions, the Conference of the States Parties acknowledged that this is not a “either/or”, and that only by tackling forcefully the two perspectives and mobilizing all the available tools will there be results on asset recovery. 

St Petersburg illustrated the growing prominence given to the issue. To deliver on the objectives of the UN Convention fundamental to both anti-corruption and development, the international community will have to approach asset recovery as a shared responsibility, between the developed and developing world, and boldly scale up its efforts accordingly. The hard work must continue on the ground, to turn words of intent into lasting actions.

The path ahead is clear – achievements in asset recovery are critical in the fight against corruption. All stakeholders involved in global and national efforts to spur asset recovery – from policy to cases – should be held to account.

Jean Pesme is the coordinator of the Stolen Asset Recovery Initiative

 

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