DATE=4/2/98
TYPE=BACKGROUND REPORT
NUMBER=5-39452
TITLE=ANTI-CORRUPTION MEETING
BYLINE=JIM TEEPLE
DATELINE=MIAMI
CONTENT=
VOICED AT: 

INTRO:  ANTI-CORRUPTION EXPERTS MEETING IN MIAMI, FLORIDA SAY 
UNREGULATED OFFSHORE FINANCIAL INSTITUTIONS ARE PLAYING A KEY 
ROLE IN THE SPREAD OF ILLEGAL ACTIVITIES AROUND THE WORLD. 
V-O-A'S JIM TEEPLE HAS DETAILS FROM THE INTERNATIONAL 
ANTI-CORRUPTION FORUM. 

TEXT: JACK BLUM IS AN INTERNATIONAL LAWYER WHO HAS INVESTIGATED 
FINANCIAL CORRUPTION AROUND THE WORLD FOR THE U-S SENATE. HE SAYS
TRILLIONS OF DOLLARS A YEAR MOVE THROUGH OFF SHORE FINANCIAL 
INSTITUTIONS.

                   // INSERT BLUM ACTUALITY //

         THERE IS NOW A NETWORK OF SOME NINETY-ODD JURISDICTIONS 
         (COUNTRIES AND/OR TERRITORIES)  THAT SELL THEIR 
         SOVEREIGNTY TO PROTECT PEOPLE FROM THE ACTIVITIES OF 
         THEIR OWN HOME COUNTRY, WHETHER IT IS THE TAX COLLECTOR,
         WHETHER IT IS THE LEGAL SYSTEM, WHETHER IT IS AN EFFORT 
         TO CONTROL FRAUD OR WHATEVER IT HAPPENS TO BE.  AND 
         THESE COUNTRIES PROVIDE BANK SECRECY, ANONYMOUS BANK 
         ACCOUNTS, CORPORATIONS WHICH CANNOT BE TRACED OR TRACKED
         AND SO-CALLED ASSET PROTECTION TRUSTS THAT KEEP THE 
         MONEY OUT OF THE REACH OF THE LEGAL SYSTEM. 

                       // END ACTUALITY //

JACK BLUM SAYS NO ONE KNOWS HOW MUCH MONEY IS IN THESE OFF-SHORE 
FINANCIAL INSTITUTIONS, BECAUSE THEY OPERATE IN A COMPLETELY 
UNREGULATED ENVIRONMENT.  THEY ARE USED BY ESTABLISHED FINANCIAL 
INSTITUTIONS AND BY CRIMINALS AND CORRUPT OFFICIALS, BLURRING THE
LINE BETWEEN WHAT IS A LEGITIMATE FINANCIAL TRANSACTION AND WHAT 
IS NOT.

// OPT // MR. BLUM SAYS VENEZUELANS LEARNED SOME HARD LESSONS A 
FEW YEARS AGO WHEN MANY VENEZUELAN BANKS MOVED INTO THE OFFSHORE 
SECTOR.   

                 // INSERT 2ND BLUM ACTUALITY //

         ALL OF ITS BANKS WERE PERMITTED TO SET OPERATIONS 
         OFF-SHORE AND THE OFF-SHORE OPERATIONS WERE VERY HEAVILY
         INVOLVED IN DRUG MONEY LAUNDERING.  WHEN THAT HAPPENED 
         AND THE DRUG PEOPLE WITHDREW THEIR FUNDS, THE ENTIRE 
         VENEZUELAN BANKING SYSTEM COLLAPSED AND VENEZUELAN 
         SOCIETY IS STILL PAYING THE PRICE. 

                 // END ACTUALITY // END OPT // 

CONFERENCE PARTICIPANTS IN MIAMI SAY OPPORTUNITIES FOR CORRUPTION
HAVE GROWN IN RECENT YEARS WITH THE EXPLOSION OF DE-REGULATION 
AND PRIVATIZATION AROUND THE WORLD.  ROBERT KLITGAARD IS THE DEAN
OF THE RAND GRADUATE SCHOOL, A PUBLIC POLICY RESEARCH INSTITUTION
BASED IN SANTA MONICA, CALIFORNIA.  HE SAYS WHEN CLOSED SOCIETIES
OPEN UP THERE ARE ENORMOUS REWARDS, AS WELL AS ENORMOUS RISKS. 

                // INSERT KLITGAARD ACTUALITY //

         AS WE MOVE TOWARDS DEMOCRACY AND POLITICAL COMPETITION, 
         WE ACTUALLY SEE AN INCREASE IN CORRUPTION.  IN PART 
         BECAUSE WE ARE ABLE TO REPORT IT MORE BUT ALSO IN PART 
         BECAUSE THE RULES OF THE GAME, WHEN THEY CHANGE OFFER 
         NEW OPPORTUNITIES FOR OPPORTUNISM. I THINK THE REAL 
         DANGER IS THAT WE WILL DISCREDIT BOTH LIBERAL ECONOMIC 
         REFORMS AND REFORMS IN POLITICAL LIFE BECAUSE OF THE 
         CORRUPTION THAT ATTENDS THEM. 

                       // END ACTUALITY //

CORRUPTION, SAY THE EXPERTS, IS MOST OFTEN PRACTICED BY ELITES 
WHO HAVE THE MEANS AND THE ABILITY TO EVADE LAWS AND REGULATIONS.
BECAUSE OF THAT, FIGHTING CORRUPTION IS DIFFICULT, BUT THE 
EXPERTS AT THE MIAMI MEETING OFFERED SOME SUGGESTIONS, SUCH AS 
PUNISHING A FEW MAJOR OFFENDERS AND  BETTER OVERSIGHT BY 
NON-GOVERNMENTAL INSTITUTIONS. THEY ALSO SAY RAISING PUBLIC 
AWARENESS CAN HELP EVEN THE MOST CASH-STRAPPED ECONOMIES IN THE 
DEVELOPING WORLD FIGHT CORRUPTION.  (SIGNED)

NEB/JLT/TMD/KL







02-Apr-98 5:39 PM EST (2239 UTC)
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Source: Voice of America
.