At a virtual kickoff event on December 7, leaders of the U.S. Caucus against Foreign Corruption and Kleptocracy, the EU Parliament Anti-Corruption Intergroup, and the UK All-Party Parliamentary Group on Anti-Corruption and Responsible Tax formally launched the Inter-Parliamentary Alliance against Kleptocracy. Members of the alliance are politicians leading the fight in their respective parliaments against corruption and kleptocracy.
The launch immediately preceded President Joe Biden’s December 9 – 10 Summit for Democracy, where approximately 110 countries committed to fighting corruption and renewing democratic values. Helsinki Commission Chairman Sen. Ben Cardin (MD), who has championed anti-corruption efforts throughout Congress, welcomed the formation of the alliance at the kickoff event.
The event began with opening remarks from Chairman Cardin, and then featured remarks from several other parliamentarians: U.S. Representatives Tom Malinowski (NJ-07) and Helsinki Commission Ranking Member Joe Wilson (SC-02); Members of the UK Parliament Margaret Eve Hodge (Barking) and Andrew John Bower Mitchell (Sutton Cornfield); and Members of the European Parliament Daniel Freund (Germany), Katalin Cseh (Hungary), and Lara Wolters (Netherlands). Helsinki Commission Senior Policy Advisor Paul Massaro moderated the discussion.
Chairman Cardin traced the history of successful anti-corruption legislation in the United States. He touched on the Foreign Corrupt Practices Act of 1977, the Money Laundering Control Act of 1986, and the Global Magnitsky Act of 2016 as examples both of bipartisan cooperation and of U.S. leadership in the international fight against corruption.
The next step, he said, is dealing with enablers. “These are the accountants, the lawyers, the financial advisers. They allow kleptocrats to be able to do their corruption through the use of rule of law of other countries,” he noted.
Rep. Malinowski stressed the connection between corruption and authoritarianism: “Corruption is the reason for being for most authoritarian regimes. It sustains them. It profits them.” Nonetheless, he observed that corruption is also a vulnerability for such regimes, as citizens ultimately refuse to accept kleptocratic leaders. Rep. Malinowski then discussed the ENABLERS Act, which seeks to close loopholes that enable kleptocrats to hide their money.
MP Hodge echoed the need to address the enablers of corruption, the structures “through which the world’s crooks and kleptocrats take their stolen money and let it disappear.”
She then explained her push, along with MP Mitchell and others, for a public register of beneficial ownership to combat the role of property in UK money laundering. MP Mitchell further discussed the push for a public register of beneficial ownership, a particularly important policy as the UK “may be responsible for up to 40 percent of the money laundering that goes on in the world.”
MP Freund continued the discussion of transparency, emphasizing that the European Parliament cannot see the final beneficiaries of EU-funded projects. He welcomed the possibility of working with the new U.S. administration and cited the success of the Magnitsky sanctions as an instance of effective U.S. leadership against kleptocracy and corruption.
Rep. Wilson echoed MP Freund’s enthusiasm for cooperation, calling corruption “a bipartisan and cross-border problem” that requires cooperative solutions. Like Rep. Malinowski, he noted the link between corruption and authoritarianism and suggested that closing the loopholes available to authoritarian governments requires international cooperation.
MP Cseh built on the previous discussion of authoritarianism, adding that corruption is inseparably linked with human rights abuses.
“Autocrats and oligarchs oppress their people so that they can enrich themselves… and they are desperately holding onto power because they want to escape prosecution for corruption,” she said. She then drew on her experience as a Hungarian opposition politician to discuss the connection between corruption and democratic backsliding.
MP Wolters delivered the final remarks of the event on the new state of the EU in light of Hungary’s democratic backsliding.
“I don’t think the EU was ever designed with the idea that we would end up with strange bedfellows internally within our system,” he said. This breach in EU sanctity entails new problems as these “strange bedfellows” have access to funding meant improve the lives of EU citizens.
The event concluded with questions from the audience. Chairman Cardin and Rep. Malinowski responded to question on the resources available to victims of corrupt and kleptocratic regimes, and MPs Freund and Cseh addressed the potential for proactive measures against interference by kleptocratic regimes in legislatures.
The Inter-Parliamentary Alliance against Kleptocracy aims to build a transparent and accountable global financial system; promote government transparency, allowing for effective public oversight; disable transnational corrupt networks, while deterring the movement of dirty money into democracies; support the role of free media and journalists in exposing the risks from kleptocracy; and advocate for strong anti-corruption standards for public officials and their enforcement. Planned projects include coordinating targeted sanctions and public visa bans, synchronizing anti-money laundering frameworks, harmonizing cross-border investigations into grand corruption, and promoting robust anti-corruption ethics frameworks for public officials.
Members of the Inter-Parliamentary Alliance against Kleptocracy subscribe to the principles that democratic states are based on the rule of law and must safeguard this system against the taint of corruption and illicit finance; that kleptocracy is an authoritarian governance model in which political leaders routinely engage in illicit self-enrichment, maintain power through corrupt patronage networks, exploit democracies to conceal and protect stolen assets, and use strategic corruption as a tool of foreign policy; and that kleptocracy poses the most profound challenge for democratic governance in the 21st century as it corrodes the rule of law from within.