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Oil for food: A shared failure

Still a long way to go on anti-bribery enforcement

Shortcomings in the United Nations (UN) Oil for Food programme uncovered by the Independent Inquiry Committee (IIC) headed by Paul Volcker reflect a shared failure among wealthy countries, their companies and international organisations such as the UN.

“It is sheer hypocrisy if high-income countries demand stringent accountability conditions from low-income countries in development co-operation without holding their companies to those same standards” said Transparency International (TI) Chairman, Peter Eigen. “We thought that the OECD anti-bribery convention represented a watershed, but we must sadly conclude that there is still a very long way to go.”

A staggering 50 percent of the 4,500 companies involved are being investigated for making an illegal payment under the programme, according to the IIC report released today. The OECD Anti-bribery convention, which prohibits the bribing of foreign public officials, precisely the misconduct at the heart of the latest IIC report, has been in force now for over five years. The United States introduced its Foreign Corrupt Practices Act almost three decades ago now. There is no excuse for the behaviour of companies from the wealthiest countries at this stage.

Will evidence translate into action?

Despite the number of companies under investigation, it remains to be seen whether convictions will follow. Although the UN has publicised its suspicions, it is up to national legal systems to take action.

“With all the recriminations flying,” said TI Director of Global Programmes, Cobus de Swardt “it should not be forgotten that the Oil for Food programme was meant to feed hungry children and prevent needless deaths. Punitive sanctions will not undo the human suffering that has been caused.”

Countries must employ the full arsenal of punitive measures at their disposal to ensure that bribery does not pay for companies. Such measures can include financial penalties and debarment from public contracting.

“There is a great deal of scepticism as to whether prosecutions will actually follow,” said Eigen. “But we, and other civil society voices, will not let the transgressions of these companies be forgotten nor will we let national governments back away from the promises they have made.”

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TI is the global civil society organisation leading the fight against corruption.

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