[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 3210 Introduced in Senate (IS)]

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114th CONGRESS
  2d Session
                                S. 3210

 To identify and combat corruption in countries, to establish a tiered 
   system of countries with respect to levels of corruption by their 
governments and their efforts to combat such corruption, and to assess 
 United States assistance to designated countries in order to advance 
  anti-corruption efforts in those countries and better serve United 
                           States taxpayers.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 14, 2016

  Mr. Cardin introduced the following bill; which was read twice and 
             referred to the Committee on Foreign Relations

_______________________________________________________________________

                                 A BILL


 
 To identify and combat corruption in countries, to establish a tiered 
   system of countries with respect to levels of corruption by their 
governments and their efforts to combat such corruption, and to assess 
 United States assistance to designated countries in order to advance 
  anti-corruption efforts in those countries and better serve United 
                           States taxpayers.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Combating Global Corruption and 
Ensuring Accountability Act of 2016''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds the following:
            (1) Corruption erodes trust and confidence in democratic 
        institutions, the rule of law, and human rights protections.
            (2) Highly corrupt governments deliberately weaken state 
        institutions, especially those associated with democratic 
        accountability, in order to improve their chances of remaining 
        in power.
            (3) A direct correlation exists between highly corrupt 
        governments and human rights abuses within countries ruled by 
        such governments.
            (4) Corruption--
                    (A) frustrates the ability of the United States to 
                combat terrorism;
                    (B) helps to foster the conditions for violent 
                extremism; and
                    (C) endangers national and international security.
            (5) Corruption damages United States competitiveness 
        globally and creates barriers to economic growth overseas.
            (6) Anti-corruption measures are instrumental in protecting 
        human rights and achieving sustainable economic growth, which 
        benefits a country's citizens and the international community 
        through the creation of open and transparent markets.
            (7) Eliminating corruption requires greater transparency 
        and accountability and effective civilian oversight.
            (8) Deterring corruption requires the credible threat of 
        prosecution to deter corrupt public servants from abusing their 
        authority with impunity for political or financial gains, in 
        collusion with private entities.
            (9) The United States is a signatory to the United Nations 
        Convention Against Corruption, having ratified the treaty on 
        October 30, 2006.
            (10) United States foreign assistance could be used to 
        encourage actors within highly corrupt countries to support a 
        more inclusive, just, and democratic political and economic 
        system that ultimately contributes to regional stability, 
        credible and legitimate United States partners, and markets for 
        goods produced in the United States.
            (11) Preventing corruption requires implementing democracy 
        and governance programs within countries receiving United 
        States foreign assistance, including--
                    (A) anti-corruption training;
                    (B) anti-corruption technical assistance to 
                national human rights institutions;
                    (C) support for civilian anti-corruption oversight 
                capabilities;
                    (D) the development of anti-corruption legal 
                mechanisms; and
                    (E) increased asset recovery and auditing 
                capabilities.
            (12) Poorly directed foreign assistance could inadvertently 
        contribute to exclusive political and economic systems that--
                    (A) contribute to insecurity within the countries 
                receiving such assistance;
                    (B) stymie their citizens' democratic and economic 
                aspirations;
                    (C) discourage a free press and civil society; and
                    (D) impede United States foreign policy goals.
            (13) Effective corruption risk assessment and analysis 
        before, during, and after the provision of foreign assistance 
        is a key element for reducing and eliminating corruption.
            (14) Comprehensive and timely data on foreign assistance 
        programs is the first step to greater accountability and 
        scrutiny by donor institutions, recipient states, and civil 
        society.
            (15) Foreign assistance provided to the security sector of 
        a foreign country is not effective at strengthening weak 
        defense and security forces unless it is properly provided and 
        closely monitored for corruption, including diversion and 
        misuse.
    (b) Purposes.--The purposes of this Act are--
            (1) to combat corruption in countries by requiring the 
        Secretary of State to establish and report on corruption in 
        such countries and the efforts of the governments of such 
        countries in combating such corruption;
            (2) to assess United States foreign assistance to 
        designated countries based on the corruption reports; and
            (3) to improve the transparency and accountability of 
        United States foreign assistance.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means--
                    (A) the Committee on Foreign Relations of the 
                Senate;
                    (B) the Committee on Armed Services of the Senate;
                    (C) the Committee on Foreign Affairs of the House 
                of Representatives; and
                    (D) the Committee on Armed Services of the House of 
                Representatives.
            (2) Corrupt actor.--The term ``corrupt actor'' means--
                    (A) any foreign person or entity that is a 
                government official or government entity responsible 
                for, or complicit in--
                            (i) ordering or otherwise directing acts of 
                        significant corruption; or
                            (ii) facilitating or transferring the 
                        proceeds of corruption to foreign 
                        jurisdictions; or
                    (B) any company, in which a person or entity 
                described in subparagraph (A) has a significant stake, 
                which is complicit in--
                            (i) directing or participating in 
                        significant corruption; or
                            (ii) facilitating or transferring the 
                        proceeds of corruption to foreign 
                        jurisdictions.
            (3) Corruption.--The term ``corruption'' means the extent 
        to which public power is exercised for private gain, including 
        by bribery, nepotism, fraud, or embezzlement.
            (4) Foreign assistance.--The term ``foreign assistance'' 
        means--
                    (A) aid given by the United States Government to 
                other countries--
                            (i) to support global peace, security, 
                        government capacity-building, democracy, and 
                        development efforts; or
                            (ii) to provide humanitarian relief during 
                        times of crisis; and
                    (B) programs authorized under title 10, United 
                States Code, or under any Act of Congress that has been 
                placed in title 22, United States Code, that provide 
                funds, military training or education, or military 
                equipment, weaponry, or services to another country for 
                its military forces and security forces, including 
                police and paramilitary forces.
            (5) Grand corruption.--The term ``grand corruption'' means 
        corruption committed at a high level of government that--
                    (A) distorts policies or the central functioning of 
                the country; and
                    (B) enables leaders to benefit at the expense of 
                the public good.
            (6) Petty corruption.--The term ``petty corruption'' means 
        the abuse of entrusted power by low- and mid-level public 
        officials in their interactions with ordinary citizens.

SEC. 4. ANNUAL REPORT AND TIERED RANKING SYSTEM.

    (a) Annual Report.--To ensure the transparency, accountability, and 
effectiveness of United States foreign assistance programs, not later 
than June 1 of each year, the Secretary of State shall submit a report 
to the appropriate congressional committees that--
            (1) describes the status of corruption in foreign 
        countries;
            (2) includes an assessment of the efforts by the government 
        of each country to combat corruption, including identifying 
        which countries are meeting the minimum standards for the 
        elimination of corruption set forth in section 5, using an 
        appropriate index or indices for measuring corruption; and
            (3) describes the status of each country's active 
        membership in voluntary multisectoral global governance 
        initiatives as evidence of the country's government-led efforts 
        to combat corruption.
    (b) Publication of Tiered Ranking List.--
            (1) In general.--The Secretary of State shall annually 
        publish, on a publicly accessible website, a tiered ranking 
        that includes all countries whose governments do not fully 
        comply with the minimum standards set forth in section 5.
            (2) Tier 1 countries.--A country included in the ranking 
        published under paragraph (1) shall be ranked as a tier 1 
        country if the government of such country is making serious and 
        sustained efforts to comply with the minimum standards set 
        forth in section 5.
            (3) Tier 2 countries.--A country included in the ranking 
        published under paragraph (1) shall be ranked as a tier 2 
        country if the government of such country is making significant 
        efforts to comply with the minimum standards set forth in 
        section 5.
            (4) Tier 3 countries.--A country included in the ranking 
        published under paragraph (1) shall be ranked as a tier 3 
        country if the government of such country is making minimal 
        efforts to comply with the minimum standards set forth in 
        section 5.
            (5) Tier 4 countries.--A country included in the ranking 
        published under paragraph (1) shall be ranked as a tier 4 
        country if the government of such country is making de minimis 
        or no efforts to comply with the minimum standards set forth in 
        section 5.

SEC. 5. MINIMUM STANDARDS FOR THE ELIMINATION OF CORRUPTION AND 
              ASSESSMENT OF EFFORTS TO COMBAT CORRUPTION.

    (a) In General.--The government of a country is complying with the 
minimum standards for the elimination of corruption if the government--
            (1) has enacted laws and established government structures, 
        policies, and practices that prohibit corruption, including 
        grand corruption and petty corruption;
            (2) enforces the laws described in paragraph (1) by 
        punishing any person who is found, through a fair judicial 
        process, to have violated such laws;
            (3) prescribes punishment for grand corruption that is 
        commensurate with the punishment prescribed for serious crimes;
            (4) prescribes punishment for petty corruption that--
                    (A) provides a sufficiently stringent deterrent; 
                and
                    (B) adequately reflects the nature of the offense; 
                and
            (5) is making serious and sustained efforts to eliminate 
        corruption.
    (b) Factors for Assessing Government Efforts To Combat 
Corruption.--In assessing a government's efforts To combat corruption, 
the Secretary of State shall consider--
            (1) whether the government of the country vigorously 
        investigates and prosecutes acts of corruption and convicts and 
        sentences persons responsible for such acts that take place 
        wholly or partly within such country, including, as 
        appropriate, requiring incarceration of individuals convicted 
        of such acts;
            (2) whether the government of the country has adopted 
        measures to prevent corruption, such as measures to inform and 
        educate the public, including potential victims, about the 
        causes and consequences of corruption;
            (3) whether government authorities in the country 
        participate in, facilitate, or condone corruption;
            (4) what steps the government of the country has taken to 
        prohibit government officials from participating in, 
        facilitating, or condoning corruption, including the 
        investigation, prosecution, and conviction of such officials;
            (5) which government authorities in the country are 
        involved in activities to combat corruption;
            (6) the extent to which the country provides access, or, as 
        appropriate, makes adequate resources available, to civil 
        society organizations and other institutions to combat 
        corruption, including reporting, investigating, and monitoring;
            (7) what steps the government of the country has taken to 
        prohibit nongovernment individuals from participating in 
        corruption, including--
                    (A) the investigation, prosecution, and conviction 
                of individuals involved in corruption;
                    (B) the criminal and civil penalties for 
                corruption; and
                    (C) the efficacy of the penalties referred to in 
                subparagraph (B) in eliminating or reducing corruption;
            (8) whether there is an independent judiciary or judicial 
        body in the country responsible for, and effectively capable 
        of, deciding corruption cases impartially, on the basis of 
        facts and in accordance with the law, without any restrictions, 
        improper influences, inducements, pressures, threats, or 
        interferences, direct or indirect, from any quarter or for any 
        reason;
            (9) whether the government of the country vigorously 
        investigates, prosecutes, convicts, and sentences public 
        officials who participate in or facilitate corruption, 
        including nationals of the country who are deployed in foreign 
        military assignments, trade delegations abroad, or other 
        similar missions, who engage in or facilitate severe forms of 
        corruption;
            (10) whether the government of the country--
                    (A) is cooperating with governments of other 
                countries to extradite corrupt actors when requested; 
                or
                    (B) to the extent that such cooperation would be 
                inconsistent with the laws of such country or with 
                extradition treaties to which such country is a party, 
                is taking all appropriate measures to modify or replace 
                such laws and treaties so as to permit such 
                cooperation;
            (11) whether the government of the country is assisting in 
        international investigations of transnational corruption 
        networks and in other cooperative efforts to combat grand 
        corruption;
            (12) whether the government of the country recognizes the 
        rights of victims of corruption and ensures their access to 
        justice;
            (13) the steps taken by the government of the country to 
        assist victims of corruption, including efforts to prevent 
        victims from being further victimized or persecuted by corrupt 
        actors, government officials, or others;
            (14) whether the government of the country refrains from 
        prosecuting victims of corruption or whistleblowers due to such 
        persons having assisted in exposing corruption, and refrains 
        from other discriminatory treatment of such persons;
            (15) whether the government of the country, consistent with 
        the capacity of such government--
                    (A) systematically monitors its efforts to satisfy 
                the criteria described in paragraphs (1) through (12); 
                and
                    (B) makes publicly available a periodic assessment 
                of such efforts; and
            (16) such other information relating to corruption as the 
        Secretary of State considers appropriate.

SEC. 6. TRANSPARENCY AND ACCOUNTABILITY.

    (a) In General.--Notwithstanding any other provision of law, prior 
to obligation by any United States agency of foreign assistance, except 
acute humanitarian and disaster assistance, to a country ranked as a 
tier 3 or tier 4 country under section 4(b), the Secretary of State, in 
coordination with the Administrator of the United States Agency for 
International Development (``USAID'') and the Secretary of Defense, as 
appropriate, shall--
            (1) conduct a corruption risk assessment and create a 
        corruption mitigation strategy for all United States foreign 
        assistance programs to that country;
            (2) require the inclusion of anti-corruption clauses for 
        all foreign assistance contracts, grants, and cooperative 
        agreements, which allow for the termination of the contract, 
        grant, or cooperative agreement without penalty if credible 
        indicators of corruption are discovered;
            (3) require the inclusion of appropriate clawback clauses 
        for all foreign assistance contracts, grants, and cooperative 
        agreements to recover United States taxpayer funds that have 
        been misappropriated from the prime contractor, grantee, or 
        cooperative agreement participant through corruption;
            (4) require the disclosure of the beneficial ownership of 
        all contractors, subcontractors, grantees, cooperative 
        agreement participants, and other organizations receiving 
        funding from the United States Government for foreign 
        assistance programs; and
            (5) establish a mechanism for investigating allegations of 
        misappropriated foreign assistance funds or equipment.
    (b) Additional Requirements.--In meeting the requirements under 
subsection (a) and overseeing the implementation of foreign assistance 
programs in Tier 3 and Tier 4 countries, the Secretary of State, in 
coordination with the Administrator of USAID and the Secretary of 
Defense, as appropriate, shall consider--
            (1) implementing appropriate safeguards to ensure that 
        disclosure of information about award recipients does not 
        create additional security risks for those operating in 
        restrictive environments;
            (2) the need to respond in a timely manner to programmatic 
        needs and prevent significant delays in the obligation of 
        foreign assistance funding, which could disrupt the 
        implementation of programs and reduce program effectiveness;
            (3) programming foreign assistance resources, including 
        democracy, rights, and governance assistance, based on need, 
        foreign policy, and development priorities, strategic planning, 
        and where assistance can be most effective; and
            (4) criteria for making a recommendation regarding the 
        termination of any contracts, grants, or cooperative agreements 
        determined to be associated with corruption and criminality.
    (c) Strategy for Incorporating Corruption Risk Assessments.--In 
order to ensure meaningful follow-through on the United States 
Government's recent commitment to strengthen attention to anti-
corruption in security cooperation and the provision of security 
assistance at the United Global Anti-Corruption Summit, the Secretary 
of State and the Secretary of Defense, not later than 180 days after 
the date of the enactment of this Act, shall submit a strategy to the 
appropriate congressional committees that details--
            (1) how the United States Government will incorporate 
        corruption risk assessments during security sector assistance 
        with foreign security forces; and
            (2) how security sector assistance will improve security 
        sector governance, as appropriate.

SEC. 7. RESOURCES AND REPORTING REQUIREMENTS.

    (a) Annual Report.--
            (1) In general.--The Secretary of State shall submit an 
        annual report to the appropriate congressional committees that 
        outlines the resources needed to meet the objectives and 
        reports under sections 4 through 6, including--
                    (A) intelligence data collection needs;
                    (B) personnel needs;
                    (C) information technology requirements; and
                    (D) a description of the bureaucratic structure of 
                the offices within the Department of State and USAID 
                that are engaged in anti-corruption activities.
            (2) Form.--The report submitted under paragraph (1) shall 
        be submitted in unclassified form, but may include a classified 
        annex.
    (b) Online Platform.--The Secretary of State and the Administrator 
of USAID shall consolidate existing reports with anti-corruption 
components into one online, public platform, which shall--
            (1) include--
                    (A) the Human Rights Report;
                    (B) the Fiscal Transparency Report;
                    (C) the Investment Climate Statement reports;
                    (D) the International Narcotics Control Strategy 
                Report; and
                    (E) any other relevant public reports;
            (2) link to third-party indicators used by the United 
        States Government to inform policy and programming, such as--
                    (A) the World Bank Control of Corruption indicator;
                    (B) the World Bank's Actionable Governance Index 
                Data Portal;
                    (C) the International Finance Corporation's Doing 
                Business surveys;
                    (D) the International Budget Partnership's Open 
                Budget Index;
                    (E) the Global Integrity Index; and
                    (F) multilateral peer review anti-corruption 
                compliance mechanisms, such as the OECD Working Group 
                on Bribery and United Nations Convention Against 
                Corruption, to further highlight expert international 
                views on country challenges and country efforts.
    (c) Training.--To increase the ability of Department of State and 
USAID personnel to support anti-corruption as a foreign policy and 
development priority, and strengthen their ability to design, 
implement, and evaluate more effective anti-corruption programming 
around the world, including enhanced skills to better evaluate and 
mitigate corruption risks in assistance programs, the Secretary of 
State and the Administrator of USAID shall incorporate anti-corruption 
components into existing Foreign Service and Civil Service training 
courses.

SEC. 8. SENSE OF CONGRESS ON CORRUPTION AND BENEFICIAL OWNERSHIP.

    It is the sense of Congress that identifying the true beneficial 
owners of companies formed in the United States or abroad, and property 
that has been removed from a country in connection with corrupt 
activities by corrupt leaders or other corrupt actors, is an important 
part of combating corruption, and the President should develop a 
comprehensive approach to requiring such beneficial ownership 
information for companies formed in the United States or abroad, and 
intensify cooperative efforts with U.S. allies toward those ends.
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