Tim Daniel, a British expert on black money
Trithesh Nandan | June 6, 2011
It will be extraordinarily difficult for India to bring back stolen assets stashed away in tax havens, says Tim Daniel, an expert on black money who is partner with UK-based law firm Edwards Angell Palmer & Dodge. In an interview with Trithesh Nandan in New Delhi, Daniel says India should move away from a culture in which nothing can be done without paying a bribe. Daniel has extensive experience in tracing assets and he has assisted several developing countries. Edited excerpts from the interview:
India is among the last countries to have ratified the UN Convention Against Corruption (UNCAC) last month? How will this ratification help India?
India is a country which suffers from a great deal of corruption. I see the country benefiting if it is seriously fighting against corruption. Ratifying the United Nations Convention Against Corruption (UNCAC) will bring several advantages. First, it empowers the civil society groups in the struggle to get the government to do things that are required under the convention. Some of them are mandatory and some are discretionary. The country comes under pressure once it ratifies the UN convention against corruption. Now, it has to put its house in order as per anti-corruption laws, prosecution and as far as independence of investigation are concerned. All of these are very important matters for India.
There are nine or ten articles in the convention which deal pre-eminently with an area where civil society can assist, basically in making people aware about corruption and in educating people and assisting the government in outreach programmes to combat corruption.
Then, you can also have multilateral treaties with other countries. This will be a real advantage for India as it is pursuing recovering of assets outside the country.
But India took a long time to ratify the treaty. Was there pressure from the international community to ratify the UNCAC?
India was subject to a lot of criticism internationally as it did not ratify the convention before May this year when it faced two big corruption issues. But the criticism was not so great because India’s economy is doing so well; in a way, money speaks and other countries did not put so much pressure on India to sign up. Also, it was becoming very difficult as anti-corruption jurisdiction was coming up in several other countries. If India had not ratified the treaty, foreign companies would have become wary of doing business in India.
From your understanding, do you think India is serious about fighting corruption and bringing back money stashed in several countries?
There is a lot said about taking anti-corruption measures in India. But what is said and what actually happens are two different things. The two recent scandals - 2G spectrum and Commonwealth Games (CWG) are very much to do with procurement, particularly the CWG. In the UNCAC, there are very helpful guidelines on how procurement should be done. Prevention is always cheaper than cure or going after the money.
Recovery of stolen assets is a multi-layered process involving many different players and institutions. Do you think that in such layers will India be able to recover the stolen assets? Is it practically possible?
It will be extraordinarily difficult for India. Other countries have tried to do it but have found it very, very difficult. There will be enormous resistance from the people whose money is pursued. In several instances foreign governments may not be very helpful and nor the law enforcement agencies. But after ratifying the UNCAC, it will be a little smoother for India to achieve the goal of bringing money back. Also, much depends on how active India is on this issue.
The G20 global political momentum has also not yielded substantially in tackling the issue of opaque financial centres. Your comment?
They have spoken a lot on doing something. Again, there is not a lot of evidence of cleaning up of the foreign jurisdictions where money goes, and indeed sanctions are not being applied against them for their failure to act. Maybe things are tightening up for them. But at present it seems business as usual.
How can India recover from moral, political and legal digressions from the corruption issue?
Well, it is all about the culture. If India wants to recover black money, then it has to take action at a number of levels – grassroots as well as the top level. The top level is more important as it sets the trend for the country. Somehow, India has to get away from the culture in which nothing can be done without paying a bribe. It is not easy but it can be done. Some countries have made a significant progress in achieving that goal.
Which countries can India draw an inspiration from in this regard?
Azerbaijan has done a lot against corruption lately. Having been regarded as one of the most corrupt countries in the world, they have put in place an effective anti-corruption commission. The judiciary is improving over time. Many companies have come up with a no-bribe policy. They do a number of outreach programmes like going to educational establishments and teaching the young about the dangers of corruption and consequences of corruption. These are very positive actions.
Will the tax havens cooperate with India?
There are a few countries which are very cooperative on this issue. Switzerland is very cooperative but Cayman Island is probably not so cooperative. This is something that the G20 is trying to deal with.
Is the Indian government making sufficient efforts in bring black money back to the country?
I haven't heard anything on this regard. This is a completely new area for the government of India.
How do see the agitation for the Lokpal Bill?
I think it would be a good move for India to have a Lokpal but much depends on how much power the Lokpal is given.
Do you think it is possible for India to break out of the cycle of rampant corruption?
Corruption can be effectively combated if the government finds political will to do it. This can get a further boost if India puts in place a legislation for an anti-corruption commission or Lokpal.
What role can civil society groups play in this regard?
As I said earlier, prevention is the key. Civil society groups can assist the governments by getting the message across on corruption as an evil. They can also put pressure on governments to introduce necessary legislations.
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