Media Release: Failure to combat foreign bribery demonstrates need for federal anti-corruption agency

28 November 2018

 

The Supreme Court of Victoria has fined Securency and Note Printing Australia, who pleaded guilty, for their role in foreign bribery. However, no directors will be held to account for these shocking events because the case was bungled by law enforcement agencies.

 

‘A fortnight ago the High Court found the former senior executives of Securency and Note Printing Australia, former subsidiaries of the Reserve Bank, cannot be prosecuted, not now, not ever, despite their alleged involvement in the corruption scandal that has dragged on for almost 10 years,’ said Transparency International Australia CEO, Serena Lillywhite.

 

‘Australia’s reputation to combat bribery and corruption is in tatters.’

 

‘It is outrageous that no one will go to jail for bribery, simply because the AFP failed to properly collect and handle evidence, conducting the investigation in both an incompetent and unlawful way.’

 

‘These decisions are a slap in the face for the two whistleblowers who bravely sounded the alarm when they suspected millions of dollars in bribes had been paid to a middleman with a reputation for corrupt conduct and relationships with arms dealers.’

 

‘For years, Transparency International Australia has held out hope that for the first time in Australia, the AFP would successfully hold company directors to account for bribing a foreign official. This now raises serious questions about the capacity of the Australian criminal justice system to handle complex financial crime.’

‘The OECD has examined the delays that have dogged this prosecution, along with delays involving other investigations by the AFP into similar offences. The OECD has long told us to get on with it and get a better anti-corporate corruption system.

 

Transparency International Australia Chair, Fiona McLeod SC said, ‘this demonstrates once again that the Australian Government needs to establish a national anti-corruption agency with broad investigative powers and oversight. We need a strong and coordinated approach – not this patchwork of inadequately resourced regulatory and enforcement agencies that lack the cohesion to seriously tackle corruption and integrity issues.’

 

‘We have been proud to work with all parties in our federal parliament, who are taking strong action to bring forward a federal anti-corruption agency. We hope that the Government and Opposition support this bill to create a federal anti-corruption agency.’

Media Release: Latest corruption scandal demonstrates need for national anti-corruption watchdog

26 November 2018

 


‘Fairfax’s latest investigation demonstrates the Australian Government’s alarming lack of capacity to effectively combat corruption,’ said Transparency International Australia CEO, Serena Lillywhite.

 

‘The latest allegations that a corrupt Border Force official was helping criminal gangs traffic drugs – and that the Australian Commission for Law Enforcement (ACLEI) knew this but could not effectively prosecute him – is truly worrying.

 

‘The Fairfax investigation demonstrates the current anti-corruption regime is just not fit for purpose and is leaving all Australians at risk of serious security threats.

 

‘If the ACLEI is unable to effectively expose major corruption, then who can?

 

‘The ACLEI must have the budget, the staff and the full support of the Australian Federal Police and other agencies to carry out investigations and conduct public inquiries to make sure these cases are exposed and the necessary action taken.

 

‘There are currently too many gaps and a lack of coordination and resourcing across government agencies to tackle corruption effectively.

 

‘Federal crossbench parliamentarians will today introduce simple and comprehensive legislation to establish a federal level anti-corruption agency.

 

‘The new agency proposed by the Independents would help plug the gaps that are allowing crime to flourish and ensure better coordination across government agencies.

 

‘It’s time for all sides of politics to prioritise this, work together and agree to a broad-based and independent national anti-corruption watchdog that takes a strong, comprehensive and coordinated approach to preventing and combatting serious and systemic corruption.’

Media Release: Wheels are in motion for a federal anti-corruption watchdog

22 November 2018


Transparency International Australia welcomes Cathy McGowan MP’s framework for a new federal anti-corruption agency, announced today.

 

‘We have been honoured to work closely with Cathy McGowan, Rebekha Sharkie, Andrew Wilkie and other cross-benchers on the thinking and drafting of the new anti-corruption and integrity framework,’ said Transparency International Australia CEO, Serena Lillywhite

 

‘Transparency International Australia has campaigned for a federal anti-corruption agency since 2005.

 

‘Our research has found falling public trust and confidence in all levels of government. More than two-thirds of Australians support the creation of an anti-corruption watchdog.

 

‘We have been speaking with all sides of the political spectrum to push for a solution which brings greater transparency, accountability and integrity across our government, including strong investigations, strong prevention, strong parliamentary standards, and strong whistle-blower protection.

 

Our National Integrity System Assessment Options Paper, authored by board member Professor AJ Brown, presented three options for building a national integrity commission.

 

‘We strongly advised option 3 – a comprehensive and independent agency, with prevention and enforcement functions and strong powers to report publicly, as well as the creation of a long overdue whistle-blower protection authority, parliamentary codes of conduct and a parliamentary standards commissioner.

 

‘We are pleased to see Cathy McGowan has agreed with our analysis in the simple but comprehensive plan she is now proposing.

 

‘While there is more work to do to address lobbying and political donations, Cathy McGowan’s proposal sets up the machinery to combat bribery and corruption and build a culture of integrity among parliamentarians, their staff and public servants.

 

‘We call on all parties to progress these Bills next week and bring a strong anti-corruption and integrity framework to fruition before the next election.

 

‘Our elected representatives must stand united against corruption.’

Media Release: Australia dragging its feet on tackling money-laundering

25 October 2018

Recent reports indicate the Australian Government will not introduce much-awaited laws to tackle money-laundering, but instead introduce technical tweaks to current legislation. As the Government reviews the Anti-Money Laundering and Counter-Terrorism Financing Act, Transparency International Australia urges Parliamentarians to take a strong stance against laundered money and illicit flows.

 

Serena Lillywhite, CEO of Transparency International Australia said, ‘Transparency International’s global research, Doors Wide Open, found Australia to be one of the most attractive destination for dirty money, especially through the property market.

 

‘While Australia regulates its major money-laundering and terrorism financing channels, such as banking, remittance and gaming; non-financial businesses and professions, such as real estate agents, lawyers and accountants, are still not subject to anti-money laundering/counter-terrorist financing requirements.

 

‘Investment in Australian property is an easy and convenient way to hide hundreds of millions of dollars from criminal investigators, tax authorities or others tracking criminal behaviour and the proceeds of crime.’

 

To turn off the tap on these illicit flows, the Government needs to

 

  • Include non-financial businesses – such as real-estate agents, lawyers and accountants, to comply with the Anti-Money Laundering and Counter-Terrorism Financing Act.
  • Establish a public register of Beneficial Ownership, including trusts, to ensure real estate agents, lawyers and conveyancers, as well as accountants undertake Customer Due Diligence to discover the ultimate beneficiaries, and submit Suspicious Transactions Reports to AUSTRAC.
  • Improve the working relationships between different actors involved in anti-money laundering to better share important information as money flows between countries of origin, transit countries, and destination countries.
  • Banks and other financial institutions must treat Politically Exposed Persons (individuals who hold a prominent public function) as high-risk and apply enhanced due diligence.
  • When facilitators fail to meet their obligations, authorities should impose appropriate sanctions, from fines and de-licensing of companies to prosecution of individuals.

 

Serena Lillywhite said, ‘money-laundering is a global problem. Every nation needs to play its part in closing the loopholes that allow criminals to enrich themselves at the expense of the community.’

 

The ease with which dirty money is laundered in the Australian property market was recently highlighted at the world’s leading anti-corruption conference, the International Anti-Corruption Conference in Copenhagen (October 22-24).

 

‘As a go-to destination for dirty money, Australia must play its role in turning off the tap of illicit flows, often the proceeds of crime and corruption.

 

‘Money-laundering has a direct impact on people in both poor and wealthy countries. These illicit funds hinder economic growth and help perpetuate conflict around the world. They often end up invested in Western property markets and luxury goods.’

 

TIA’s national conference in April 2019 will put this issue once again on the agenda. A key conference theme will explore money laundering through the Australian property market.

Media Release: Transparency International Australia welcomes new Chair

15 October 2018

 

Transparency International Australia welcomes Fiona McLeod SC as the new Board Chair.

 

‘I warmly welcome Fiona to the leadership of our Board. We are grateful to have her extensive experience in, and lifelong commitment to, promoting justice, accountability and transparency,’ said Transparency International Australia CEO, Serena Lillywhite.

 

‘I am delighted to have been chosen to Chair of the Board of Transparency International Australia,’ said Fiona McLeod.

 

‘It is an honour to work for such an important organisation dedicated to tackling corruption and promoting good governance.

 

‘By improving transparency and strengthening accountability, we tackle the root causes of many of the social, political and environmental challenges confronting the world today.

 

‘I look forward to supporting Transparency International Australia as it goes from strength to strength.’

 

Fiona McLeod SC is the Co-Chair of the Open Government Forum and Chair of the Accountability Round Table.

She is a Past President of the Law Council of Australia and the Australian Bar Association; she was Chair of the Victorian Bar and President of Australian Women Lawyers.

Ms McLeod has been recognised with numerous awards for excellence and leadership, for her work in supporting diversity and equality, the advancement of women and her work in pro bono and human rights matters including human trafficking.

Ms McLeod was inducted onto the Victorian Honour Roll for Women in 2014 and is a recipient of numerous professional awards including the prestigious inaugural Commonwealth Government Anti-Slavery Australia Freedom Award for her work representing victims of human trafficking, raising awareness and contributing to law reform and policy on this issue.

Media release: Growing body of evidence demonstrates need for a federal anti-corruption and integrity agency.

24 September 2018

 

Transparency International Australia welcomes the Grattan Institute’s latest report, Who’s in the room? Access and influence in Australian politics.

 

‘There is a growing body of evidence that our political system is too exposed to corruption risk and integrity failings.’ said Serena Lillywhite, CEO of Transparency International Australia.

 

‘The Grattan Institute’s report reinforces the calls we have long made: we need an independent federal anti-corruption and integrity agency with the powers to investigate, including breaches of the federal Code of Conduct, and greater checks and balances against unfair influence.

 

‘The Grattan Institute report builds on our research that found the majority of Australians responding to the Global Corruption Barometer survey had either seen, or suspected, politicians or government officials favouring businesses or powerful individuals in return for political donations or support.

 

‘Our research found people working for government, our public servants, have even higher concerns about undue influence driving policy and government decision- making.

 

‘Transparency International’s research into the mining approvals process in Queensland and Western Australia also confirmed corruption risks from inappropriate and unregulated political influence.

 

‘Lobbying, the revolving door between government and industry and a culture of mateship that facilitates deals between friends, all leave the approvals processes around mining licenses and related infrastructure vulnerable to corruption.

 

‘We welcome the Grattan Institute’s calls for greater transparency and accountability, particularly a federal anti-corruption agency.’

 

Media contact: Alex Lamb alex.lamb@transparency.org.au 0466 976 602

New Discussion Paper: A National Integrity Commission – Options for Australia

On 21 August 2018 Griffith University researchers published a new discussion paper, A National Integrity Commission – Options for Australia at the National Integrity Systems Symposium in Canberra.

TI Australia is a lead partner in the Australian Research Council project – Strengthening Australia’s National Integrity Systems – Priorities for Reform, and this Options Paper provides new evidence that significant reform of our national integrity framework is needed.

TI Australia has long called for the establishment of a comprehensive, broad based anti-corruption agency at a federal level – with the scope, investigative and coercive powers necessary to combat bribery and corruption and to build an integrity framework, and to both prevent and detect the ‘grey areas’ of misconduct and integrity breaches at a national level.

This Options Paper provides some real solutions to real problems – problems that have been addressed by community response to the Global Corruption Barometer Survey.

The Options Paper provides the evidence to support the creation of a new federal anti-corruption and integrity framework, based on an assessment of the strengths and weaknesses of the existing framework, and community
awareness, perception, and views on how well corruption is being addressed at all levels of government.

Read TIA CEO Serena Lillywhite’s full response to the options paper in her speech delivered at the National Integrity Systems Symposium on 21 August.

The full A National Integrity Commission – Options for Australia paper is available for download on Griffith University website, where you can also find a summary version.

Media Release: Rising Corruption Concern Drives Support for Federal Integrity Body

20 August 2018

Global Corruption Barometer Survey Results

‘Rising Corruption Concern Drives Support for Federal Integrity Body’

Australians’ trust in government has continued to slide, driven by growing concerns about corruption at the federal level, according to a special Global Corruption Barometer survey conducted by Griffith University and Transparency International Australia.

The results also show strong support for creation of a new federal anti-corruption body, with two-thirds (67%) supporting the idea, especially in Victoria, NSW and South Australia – with those ‘strongly supporting’ the idea outstripping those who strongly oppose it by 4 to 1.

Combined with Griffith University’s Australian Constitutional Values Survey, the in-person telephone poll of 2,218 adults, conducted in May-June, provides the first measure since 2012 of the growing impact of corruption on citizens’ trust and confidence in government. The survey shows:

  • Trust & confidence in all levels of government fell in the last year, to 46% for federal and state levels and 51% for local government nationally
  • Continued low levels of experienced bribery (less than 2%), but high concerns about officials or politicians using their position to benefit themselves or family (62%) or favouring businesses and individuals in return for political donations or support (56%)
  • A 9 point increase since 2016 in perceptions that federal members of parliament are corrupt (85% at least ‘some’ corrupt, 18% ‘most/all’ corrupt) – placing them on par with state parliamentarians and worse than local officials.

Project leader Professor A J Brown, of Griffith University’s Centre for Governance & Public Policy, said the results provide both a warning and an opportunity for Australian governments.

“We now see a stronger correlation between trust and action against corruption.”

“Well over a third of citizens’ total trust and confidence is now explained by whether they feel the government is doing a ‘good job in fighting corruption’ (37% at the federal level, 25% state).

“Continued slippage in the perceived integrity of federal officials clearly has a disproportionate effect on overall trust and confidence, nationwide.”

Federal anti-corruption agency support

The survey is the first to test support for a federal anti-corruption body by also presenting respondents with a counter proposition – but still records strong support across the community, especially among respondents who have ever worked for the federal government itself.

Two-thirds of Australians (67%) support the idea, with most of these (43%) expressing strong support, against only 10% expressing strong opposition.

Respondents were also told: “Other people say a new agency isn’t needed because existing bodies like the Australian Federal Police are already adequate to deal with federal corruption”, before being asked to express a view.

Support is slightly higher among women (70%) than men (65%), and among citizens of Victoria (73%), NSW (69%) and South Australia (68%), and lower among those over the age of 65 (60%) but otherwise spread broadly across the community including all education levels.

Among the 1,011 respondents who had worked in government, the 245 respondents who had ever worked in the federal government recorded the highest level of strong support for a new federal agency – 54% against the national average of 42%.

The same group were marginally less likely than other respondents to rate corruption in government as a big or very big problem (50% against the national average of 57%), but were:

  • the least likely to say that the “task of fighting corruption” was currently being handled well at the federal level (35% against the national average of 48%)
  • more likely than other respondents to have witnessed or suspected an official or politician of making a decision in favour of a business or individual who gave them political donations or support in the last 12 months (68% against national average of 56%)

Undue influence a major concern

Serena Lillywhite, CEO of Transparency International Australia, said the results “firmly show that the risk of undue influence and decisions that benefit business and powerful individuals is real, and driving increasing corruption concerns”.

“For 56% of respondents – equating to over 10.2 million Australians – to say they had personally witnessed or suspected favouritism by a politician or official in exchange for donations or support is nothing less than shocking.”

“This snapshot also shows the case for a strong, comprehensive federal anti-corruption agency is well understood by those within government, not just based on the fears of outsiders.”

“Improved transparency and strengthened oversight of government decision making, including the regulation of lobbyists, is also long overdue,” Ms Lillywhite concluded.

New options paper to be released – Canberra symposium 21st August

The Corruption Barometer results coincide with Australia’s Public Integrity Institutions: Strengths, Weaknesses, Gaps, being held in Canberra on Tuesday 21 August. A major new paper, A National Integrity Commission: Options for Australia, will be released at the symposium.

The survey and symposium form part of the Australian Research Council project Strengthening Australia’s national integrity system: priorities for reform, led by Griffith University and Transparency International Australia, conducting Australia’s second National Integrity System Assessment.

FOR MORE INFORMATION:

See the full media and data release here.

Professor A J Brown, Griffith University – 0414 782 331
Serena Lillywhite, TI Australia – 0403 436 896

End.

 

CBA’s Historic $700M Fine Highlights the Need to Include Money Laundering in the Scope of Banking Royal Commission

On 4 June 2018 CBA reached a settlement with AUSTRAC, agreeing to pay a fine of $700 million plus legal costs over serious and systemic failures to report suspicious deposits, transfers and accounts. CBA admitted to the late filing of 53,506 reports of transactions of $10,000 or more through its “intelligent deposit machines” (IDMs).

 

Watch Transparency International Australia’s CEO Serena Lillywhite comment on the case in ABC News:

Video: ABC News Channel

 

In her interview, Serena Lillywhite says that although the fine falls far short of the theoretical maximum penalty (nearing one trillion dollars), it is the largest ever civil penalty in Australian corporate history and thus sends a strong signal to the banking sector.

 

While it is encouraging that CBA has admitted that it has breached the Anti-Money Laundering and Counter-Terrorist Financing Laws, this case shows that it is still way too easy to launder money in Australia. IDMs (ATMs that instead of giving out withdrawals take in deposits) are not the only weak point in the Australian system – Transparency International’s report Doors Wide Open shows that the Australian real estate market is vulnerable to money laundering through anonymous property purchases.

 

The immense scale of the CBA case and its impact on the public trust in the financial sector highlights an omission in the scope of the Banking Royal Commission – it does not currently cover money laundering. Transparency International Australia recommends extending the scope of the Commission to cover this critical aspect of Australia’s financial integrity system.

 

TIA CEO discussed the CBA case on the World Today, along with Austrac CEO Nicole Rose, and Professor Jason Sharman from Cambridge University. The broadcast is available on the ABC website and below.

 

Media Release: Corruption Perceptions Index (CPI) 2017 shows Australia falls again in Corruption Perceptions Index scores

Australia, 22 February 2018 – The Corruption Perceptions Index released today by Transparency International shows that Australia has fallen again in the CPI score.

Despite attempts to combat corruption around the world, the majority of countries are moving too slowly in their efforts – including Australia, who has continued to slide.

While Australia’s ranking has not changed – 13th for three years running – and it may appear we are holding ground, our CPI score has notably decreased over the last six years.

In 2012, Australia scored 85 out of 100. Today, in the latest CPI, Australia has slipped 8 points, receiving a score of 77, and remains outside the top 10 countries. Australia scored 79 in 2016.

“This suggests a loss of trust in the Australian public sector and the perception, at best, that corruption has gotten worse, in only a few short years”, said Serena Lillywhite, CEO of Transparency International Australia.

The Index, which ranks 180 countries and territories by their perceived levels of public sector corruption according to experts and business leaders, uses a scale of 0 to 100, where 100 is the cleanest, and 0 is the most corrupt.

In the 2017 CPI, several countries significantly improved their CPI score, such as Côte d’Ivoire, Sénégal and the United Kingdom, while several countries declined, including Syria, Yemen and Australia.

The CPI scores and ranks the perception of corruption on a number of corrupt behaviours in the public sector from bribery to the diversion of public funds. It also looks at the mechanisms available to prevent corruption, such as the government’s ability to enforce integrity mechanisms, access to information and the legal protection for whistleblowers, journalists and investigators.

“It’s hardly surprising Australia’s corruption perception score continues to fall, the integrity score card has taken a battering”, said Serena Lillywhite.

“The misuse of travel allowances; inadequate regulation of foreign political donations; conflicts of interest in planning approvals; revolving doors; a culture of mateship; and inappropriate industry-lobbying in large scale projects, such as mining, and the misuse of power by leading politicians – have no doubt had an impact”, she said.

Within the Asia Pacific region, where the regional average score is 44.39, New Zealand, scored 89, and now ranks number one in the world on the CPI. Close neighbours, Singapore, scored 84, with Indonesia scoring 37 and PNG scoring 29.

In comparison to Australia’s declining score, the UK, over the last six years, has improved its score from 74 to 82.

Most African countries scored well below 50. Australia is the largest miner on the continent, with 140 ASX companies alone operating in 34 countries across Africa.

“This should have alarm bells ringing for Australian miners, and underscores the importance of Transparency International Australia’s work to combat corruption in mining approvals”, said Lillywhite.

The 2017 CPI results indicate that more needs to be done to strengthen Australia’s national integrity system.

“Australia’s failure to improve its position on the CPI suggests a failure to address with sufficient urgency a range of serious public-sector issues. These include money-laundering, whistleblowing, political donations and the effectiveness of our integrity systems. The Government has simply not faced up to the need to have in place an independent anti-corruption agency at a national level”, said Anthony Whealy QC, Chair of Transparency International Australia.

Australia’s failure to advance up the rankings – and in fact its further decline in the scoring in the Corruption Perceptions Index highlights the need for urgent collective action. Corruption, or even the appearance of corruption, has no place in the Australian public sector.

END

Download the report.

Contact:

Alexia Skok, Communications and Advocacy Coordinator, alexia.skok@transparency.org.au

Serena Lillywhite, CEO, serenalillywhite@transparency.org.au, phone: 0403 436 896 (Melbourne)

About the Corruption Perceptions Index

Since its inception in 1995, the Corruption Perceptions Index, Transparency International’s flagship publication, is the leading global indicator of public sector corruption. The CPI offers an annual snapshot of the relative degree of corruption by ranking countries from all over the globe. For more information, visit the Transparency International website.

Note to Media: Transparency International Australia and Griffith University are conducting a National Integrity System Assessment to help identify integrity gaps and propose solutions. See the National Integrity Systems Assessment page.

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