International Fraud and Corruption

According to the World Bank, fraudulent and corrupt practices involve the payment, receipt, and solicitation of kickbacks or gratuities, bribes, or the manipulations of loans and Bank Group funded contract in any form of misrepresentation. In addition, fraud is manifested in situations where members of staff abuse their positions or misuse World Bank Group finances or other public money for selfish gains (Button, Johnston & Frimpong, 2008). Although corruption comes in different ways, the most frequent occurrence is in bribes that are used to influence the award of the contract, expedite public processes, obtain licenses, affect judicial verdicts, and so forth.

Transparency International is the worldwide civil institution which leads the fight against corruption. It brings together stakeholders in a strong global coalition to suppress the devastating effects of corruption on the larger global community. In reference to the Transparency International, corruption is the manipulation of commended power and authority for personal gains. The organisation is for the nonprofit purpose of taking action to tackle global corruption and bar criminal actions arising from corruption (Dyck, Morse & Zingales, 2010). Both World Bank and Transparency International engage similar strategic plans in fighting fraudulent activities. The paper presents a critical comparison of the two organisations and the manner in which they combat corruption and fraud around the world.

World Bank against corruption and fraud

World Bank establishes anti-corruption efforts spearheaded by an amalgamation of concerned stakeholders. Often, such parties include politicians, senior government officials, civil society, the private sector, and the communities as a whole. Progressively, addressing the menace of corruption calls for the concerted attention from governments and business organisations (Rose-Ackerman & Palifka, 2016). Further, it requires the application of advanced technology in capturing, analysing, and sharing information with the intention of detecting, preventing, and sanctioning corrupt undertakings. Much of the entire world’s high-value corruption scandals could not materialise without inputs of large institutions in wealthy countries. In this sense, the private sector is a large contributor to significant magnitudes of bribes. Further, financial institutions accept laundered money, and there are professionals like accountants and lawyers who facilitate the corrupt behaviour on a global platform (Rose-Ackerman & Palifka, 2016). It may not be practically possible to engage these stakeholders in fighting corruption in certain regions of the world. Corrupt politicians, government officials, and private sector organisations benefiting from sleaze and fraud are not likely to engage in fighting corruption genuinely in their localities of operation.

On top of organising key stakeholders in coalitions that fight corruption and fraud, the World Bank Group strives to develop capable, accountable, and transparent institutions that are designed to implement anti-corruption initiatives. The organisation’s work involves changing results through assisting both the state and non-state entities to have required competencies with regard to the implementation of practices and policies that enhance results and build public integrity. Pursuant to the Anti-Corruption Summit of May 2016, the Bank Group confirmed its commitment to fight corruption as the main development factor wherever it exists and in support of uprightness in the public sector institutions. World Bank is committed to building capacity for country clients to deliver their commitments, achieve enhanced transparency levels, and minimise corruption (Harker & Castellano, 2011). Further, the World Bank aims at enforcing its advocacy for anti-money laundering requirements and for the repossession of stolen assets. The organisation intends to work through other institutions in the quest to fight corruption and fraud around the world. Such an arrangement means that there lacks the first-hand contact with the element of corruption in the world. For this reason, it is likely that the World Bank engages potentially unproductive organisations in the exercise and these results in ineffectiveness in combating corruption and fraud on a global platform.

Further, the World Bank fights against corruption by barring fraud within its projects. The approach of the bank towards combating corruption is a combination of the proactive dogma of speculating and avoiding perils in its own undertakings. It has a commitment to assist stakeholders and clients to identify and fight corruption both on national and international platforms (OECD, 2011). World Bank exposes all its potential undertakings vigorous scrutiny and works in conjunction with clients to suppress probable corruption risks as identified. Public complaint forums built into the projects promote and endow oversight and undertakings are aggressively monitored throughout implementation.

World Bank claims to have zero-tolerance policies towards corruption in its affiliate projects (Harker & Castellano, 2017). In cases where suspicions of corruption and fraud are proven, corporate bodies involved in the misconduct are barred from taking part in fresh bank funded activities. Concerned administrations receive the findings of Bank Group research wherein the last eight years; it has banned hundreds of individuals and organisations from participating in its projects. Considering its projects as a part of the strategic fight against corruption appears to be a micro-management way of looking into the massive menace of fraud around the world (Harker & Castellano, 2017). The bank’s projects are in a large way inconsequential to the question of fraud and corruption at a global level.


Transparency International

Transparency International is another global organisation, which like World Bank, is actively involved in fighting corruption worldwide. The institution focuses on bringing together different stakeholders in the global economy with the aim of encouraging them to operate at high integrity levels pursuant to the body’s standards of conduct. Transparency International creates a coalition of concerned and willing parties and entities, which combine efforts to combat the menace of fraud and corruption on a global platform (Aidt, 2009).

The critique view of this strategy is that such coalitions often have interested parties when it comes to the issue of corruption. For this reason, there could be partisan ways of handling fraud and corruption cases. Some of the prominent global businesspersons often have an immense influence on political and social aspects of life for many people around the world. In this sense, when the Transparency International forms a coalition in which such individuals are represented in disguise, combating global fraud and corruption becomes significantly difficult (Aidt, 2009). It is important for the body to vet members of these coalitions when admitting them because some could have significant interests to protect when combating corruption and fraud.

Transparency International takes fraud and corruption into account more explicitly in country assistance initiatives. In this sense, the organisation adopts aggressive advocacies against fraudulent behaviours around the world. It advocates for policy dialogues through maintaining active relationships and conversations with other anti-corruption organisations around the world (Hale & Held, 2018). Cross-border dogmas are more likely to fight corruption on a global platform as compared to localised approaches to dealing with the menace. The organisation employs foreign anti-corruption tools to assist in launching their individual investigations, fostering domestic prosecutions, and engaging in settlement proceedings or debates (Transparency International, 2010).

Such a hands-on approach to combating corruption and fraud internationally is likely to bear success in the end. However, such aggressiveness is likely to be met with resistance in somewhat a similar measure or a significant wish for maintenance of the status quo. Often, the organisation’s initiatives of combating corruption face internal resistance because there is lack of the willingness to take risks and confront corrupt people who are in positions of power and influence around the world (Transparency International, 2011). The organisation intends to combat corruption in different levels of governance both in the private and public sectors, but they are likely to be unsuccessful because of their aggressive and proactive nature.

The organisation ranks and recognises countries around the world in relation to their corruption indices. The metrics show how countries are faring on the global platform as concerning fighting corruption. According to Transparency International, the year 2017 indices highlighted that a majority of nations’ metrics depict that corruption perception rating measure towards zero. The analysis further proves that activists and journalists in corruption-manifested countries risk their lives all the time in an effort to speak about fraud in their nations (Dyck, Morse & Zingales, 2010). The year 2017 corruption index ranked 180 nations around the world on the basis of perceived levels of public sector fraud. In the study, the index concluded that more than two-thirds of countries score an average of 43 points on a scale of 0 to 100; 0 is highly corrupt whereas 100 is a clean system of public administration (Transparency International, 2018). From the perceptions indices, it is evident that prevalence of fraud and corruption is still immensely strong around the world.


Comparison between World Bank and Transparency International

Both World Bank and Transparency International combat corruption and fraud through agitating demand for the control of the pilferage activities. A constant flow of information originating from credible sources on the consequences and incidence of corruption piles pressure on civil servants to curb corruption in their different portfolios. Further, increased awareness regarding the engagement of international figures exploiting global systems in the corrupt endeavours puts the senior government officials on a potential spot when they participate in illicit management affairs (Mungiu-Pippidi, 2013). The results of national and global opinion studies and other investigation by international organisations like the World Bank and Transparency International are of paramount importance in strengthening information database in combating corruption and fraud.

Information transmission channels such as mass media are owned by powerful political figures in different countries around the world. For this reason, these senior government officials more so in the developing countries often dictate the kind of news and discussion forums to be held in their proprietorships. Members of the public may be barred from accessing real occurrences in their country for this reason. However, the current technology age comes with alternative communication channels through the Internet. Masses have real-time updates on various events taking place in their regions through social networks and other outlets beyond the mass media (Mungiu-Pippidi, 2013).

The World Bank maintains and publishes statistical data regarding the expenditure of doing business and results of corporate research surveys in different countries in the world. The surveys usually track indicators such as the time it takes for the processing of corporate licenses and money paid unofficially to obtain the business permits. Further, the bank assesses the value of gifts expected in order for an entity to secure public service contract and the adversity of fraud and corruption as a hindrance to business organisations. Such indicators reveal the countries that have business environments favourable for bribery. In this sense, the international organisations identify nations that lack clear rules orthodox means of cutting through red tape and reducing potentially costly delays (Mungiu-Pippidi, 2013). Through identifying these countries, the administration of the day is in a position to identify corruption gaps in the system with regard to public service delivery.

Transparency International and World Bank increase demand for sound governance among the masses through advocacy. Together with instant communication, and increased information, strengthening global advocacy against fraud and corruption increasing the perils that fraudulent elements in a society must face. There is a direct threat to corrupt people in the system and hence pilferage of public funds is curtailed in a great way. Both of these international organisations pile up the domestic pressure on public and private sector administrators for them to implement appropriate anti-corruption strategic measures (Persson Rothstein & Teorell, 2013). The international community exerts pressure for the formulation and implementation of reforms using elements such as promises for additional intervention and threats of economic sanctions as entrenched in international laws.

In efforts of combating illicit monetary and economic activities, these international bodies seek to increase the supply of anticorruption measures. Both World Bank and Transparency International look into addressing broad institutional and governance issues for successful combating of corruption. A multidimensional methodology to the issue involves deliberate actions to enhance prosecutorial, judicial, and legal systems as a whole in countries hard-hit by the menace of corruption and fraud. Improvement to the legal system is possible through fostering the voice of and participation by civil society in the process of eradicating corruption in a country (Persson Rothstein & Teorell, 2013). It is through such voices that there is advocacy for sound public sector expenditure, political accountability, and competition in the private sector.

Among the most frequent areas for action, are the public sector pay, the culture of impunity, inadequate regulation, broad discretionary powers, and political corruption. When these factors are coupled up with weak disclosure to the public, constrained space for the civil society, and suppression of media independence, it becomes nearly impossible to counter fraud and corruption (May, 2016). The international organisations have developed measures that up-surge the supply of reforms by disclosing information regarding government performance and services to members of the public. In addition, the organisations plan for inclusion and participation in formulation and enforcement of service delivery undertakings, encouraging social accountability (May, 2016). These efforts create room for easy access to justice and productive assets for all people in the society as well as promote jurisdictive accountability and independence.

Although these international organisations are committed to the course of eradicating corruption and fraud around the world, it is impossible for them to materialise their efforts without national internal goodwill (OECD, 2011). Main institutions in combating corruption around the world include the judiciary, public prosecutors, the media, citizen groups, the civil society, and other non-governmental organisations. Some of such bodies like the judiciary and media are supposed to be independent of the executive arm of the government (May, 2016). However, all of them need long-term support to be effective and have to showcase best-practice governance in operations.

The anti-corruption institutions have to function in an integrated way, and they are likely to be ineffective when they operate in isolation. Transparency International has openly advocated for an integrated way in the sort of national integration system (Button & Cross, 2017). The main aim of the arrangement is to embrace national integrity and provide for the country to develop sustainably embrace the rule of law, and improve the quality of life of citizens. Depending on these institutions sparingly is likely to make the system susceptible to collapse from massive irregularities.

The efficacy of each of these institutions depends on different factors such as clear powers, rules, mandates, and responsibilities prescribed in constitutional law or entrenched in tradition. It is important for these bodies to be independent of influences which could compromise their quest of dealing with the menace of corruption in the society on a global platform (Button & Gee, 2013). World Bank and Transparency International are reputable organisations that are credible and well-known for their genuine fight against fraud and corruption globally. The past inability of these bodies to eradicate corruption fully more so in the developing countries makes it clear that these bodies alone are not sufficient (Button & Gee, 2013). A majority of these organisations are planned to work in environments of conducive governance and have proved to be ineffective in systems where there are massive fraud and endemic corruption. Where leadership is strong, at times with bilateral or international support, there have been cases of success even in the most corrupt systems.

World Bank acknowledges that a concerted effort is instrumental in winning fights against corruption and it proactively supports interagency and international initiatives combating fraud and corruption. The organisation has formed partnerships with the International Monetary Fund and regional development banks in striking a consensus on broad practices and dogmas needed in fighting corruption (Button & Gee, 2013). The partnerships concentrate on governance capability and are founded on initial research studies gathered in a greatly participative way. Both World Bank and the Transparency International have forged partnerships with different organisations such as professional bodies, government departments and departments, and interagency discourses (Button & Gee, 2013). In this respect, both of these bodies are highly interested in eradicating fraud and corruption in the world.

Conclusion

Fraud and corruption are the main causes of stagnation of growth and development of the global economy. Corruption thrives both in public and private sectors around the world. It has been rampant because it is supported by powerful and influential people who control the system. Different organisations commit their efforts towards corruption and fraud for there to be sustainable growth and development in the world. Both the World Bank and Transparency International are global organisations that focus their endeavours towards eradicating fraudulent ways of things around the world. They use different and somewhat similar strategies in fighting these vices. In the process of combating fraud and corruption, the international bodies counter challenges such as lack of political and administrative good will to combat corruption. Various powerful and influential figures in different countries seek to protect their interests and hinder the efforts of fighting corruption. In addition, efforts put in place by these bodies often prove to be unproductive and comes with no success due to their vagueness. Fighting corruption in the world requires the efforts of these bodies to be coupled up with political and administrative goodwill in various countries around the world.

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