[Joint House and Senate Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
117th Congress Printed for the use of the
1st Session Commission on Security and Cooperation in Europe
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Uniting Against Corruption: Launch of
the Inter-Parliamentary Alliance Against
Kleptocracy
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
DECEMBER 7, 2021
Briefing of the
Commission on Security and Cooperation in Europe
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Washington: 2024
Commission on Security and Cooperation in Europe
234 Ford House Office Building
Washington, DC 20515
202-225-1901
[email protected]
http://www.csce.gov
@HelsinkiComm
Legislative Branch Commissioners
SENATE HOUSE
BENJAMIN L. CARDIN, Maryland STEVE COHEN, Tennessee
Chairman Co-Chairman
ROGER F. WICKER, Mississippi Ranking JOE WILSON, South Carolina Ranking
Member Member
RICHARD BLUMENTHAL, Connecticut ROBERT B. ADERHOLT, Alabama
JOHN BOOZMAN, Arkansas EMANUEL CLEAVER II, Missouri
MARCO RUBIO, Florida BRIAN FITZPATRICK, Pennsylvania
JEANNE SHAHEEN, New Hampshire RUBEN GALLEGO, Arizona
TINA SMITH, Minnesota RICHARD HUDSON, North Carolina
THOM TILLIS, North Carolina GWEN MOORE, Wisconsin
SHELDON WHITEHOUSE, Rhode Island MARC A. VEASEY, Texas
Executive Branch Commissioners
Department of State, to be appointed
Department of Defense, to be appointed
Department of Commerce, to be appointed
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Uniting Against Corruption: Launch of the Inter-Parliamentary
Alliance Against Kleptocracy
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December 7, 2021
Page
COMMITTEE MEMBERS PRESENT
Senator Ben Cardin [D-MD], Chairman ............................ 1
Representative Joe Wilson [R-SC], Ranking Member ............... 7
COMMITTEE STAFF PRESENT
A. Paul Massaro, Senior Policy Advisor, Commission on Security
and Cooperation in Europe .................................... 1
PARTICIPANTS
Representative Tom Malinowski (D-NJ) ........................... 3
Andrew John Bower Mitchell, Member of the U.K. Parliament for
Sutton Coldfield ............................................. 4
Margaret Eve Hodge, Member of the U.K. Parliament for Barking .. 4
Daniel Freund, Member of the European Parliament, Germany ...... 6
Katalin Cseh, Member of the European Parliament, Hungary ....... 8
Lara Wolters, Member of the European Parliament, Netherlands ... 9
Uniting Against Corruption: Launch of the Inter-Parliamentary
Alliance Against Kleptocracy
----------
December 7, 2021
The event was held from 11 a.m. to 11:45 a.m. via videoconference,
Senator Ben Cardin [D-MD], Chairman, of the Commission on Security and
Cooperation in Europe, presiding.
Mr. Massaro: Okay. Well, thank you all for joining the launch of
the Inter-Parliamentary Alliance Against Kleptocracy. This event is
getting started. We will go for one hour and end at one hour sharp and
we are very happy to have all of these distinguished members with us
today, a cross-border, cross-party alliance. We are going to start with
opening remarks from Senator Cardin.
Therefore, please, Senator Cardin.
Chairman Cardin: Well, Paul, first of all, thank you very much for
getting us all together as we launch the Inter-Parliamentary Alliance
Against Kleptocracy. It really is a pleasure to join my parliamentarian
colleagues from the U.K. and from the EU. This is so exciting because
we recognize that the only way that we can be effective in our policies
is to have unity among those states that represent the democratic
states of the world, and it is wonderful that we have this type of
alliance to deal with this.
Make no mistake about it: This is a very timely event. Freedom
House, once again, did their ratings of democratic states and it is
shocking to see a decline of people in the world that are living under
a free society. We are now down to less than 20 percent of the world's
population that live in a fully free country. That is an alarming
number, so we recognize we have a very critical role to play.
President Biden this week is starting his Summit for Democracy to
try to develop a strategy in which we can advance democratic states. It
is interesting, that the central theme on these discussions will be,
how do we deal with kleptocracies, how do we deal with corruption? That
is the key. Corruption is the fuel for autocratic societies, for
societies that are oppressive against their own citizens, and they get
that corrupt funding through the kleptocracy structure. Therefore, we
are right in the thick of the most important discussions we are dealing
with in preserving democracies.
Therefore, let me just underscore the importance of the role of
parliamentarians. We lead. We are the ones who provide the policies to
deal with this. We do not have to worry about the niceties of diplomacy
that sometimes we see involved in the efforts to try to get countries
to do certain things. Therefore, when I look back at some of the
critical moments in the parliamentary history in the United States in
fighting corruption, I see in 1977 the passage of the Corrupt Practices
Act. Now, that act said that American companies could not take bribes
in order to get work in other countries. In 1977, that was
revolutionary. Our business community said, wait, you're going to
penalize us? We are not going to be able to do business in other
countries? That is the way things work. We said no. We have got to
change that and it only can be changed if we show leadership among the
democratic countries of the world. We passed that law, and other
countries have followed suit, and guess what? Our American companies
are doing business abroad and they are not paying bribes. We can make a
difference.
Then we passed the Laundering Control Act of 1986 that said our
banking systems need to be protected against the laundering of funds.
Once again, we ran into resistance, but parliamentarians spoke out and
we got things done. We changed the whole climate on the responsibility
of institutions as it relates to laundering of money.
Then, in 2016 with the passage of the Global Magnitsky law--and I
am so proud about that, and my partner on that was the late John
McCain, a Republican. I am a Democrat. We do not agree on too many
social policy issues--we did not agree on too many social policy
issues, but we agreed that we have to stand up against the human rights
violators of the world and those who perpetrate that through
corruption, and we got that done.
Thank you, U.K., and thank you, EU. You have enacted your own
Global Magnitsky laws and we appreciate that. Canada also followed
suit. Australia's senate passed this month a Global Magnitsky bill.
Japan and Taiwan are working on this. When we lead, other countries
will follow and we can make a major difference.
Therefore, I want to promote three legislative initiatives that we
are looking at right now in the United States Congress and I think Joe
Wilson will be with you later. This is bipartisan. Joe's a Republican,
I am a Democrat. My partner in the Senate is Roger Wicker on most of
these bills. We chair and ranking Republican on the Helsinki
Commission. However, we have legislation that would make permanent and
expand the Global Magnitsky law.
Now, let me tell you something: We need to take Global Magnitsky to
the next level, and that means dealing with the enablers. These are the
accountants, the lawyers, the financial advisers. They allow
kleptocrats to be able to do their corruption through the use of the
rule of law of other countries. We have got to stop that, and if we can
hit them with Magnitsky-type sanctions so they cannot use their banking
system and they cannot travel, it will make a huge difference.
Therefore, that is an important bill we need to get done.
We need to get the Combating Global Corruption Act--I am sorry, the
Combating Corruption Act that I have introduced with Senator Young, a
Republican from Indiana, that would use the model of Trafficking in
Persons TIP reports for corruption so we evaluate every country in the
world on how well they are doing in fighting corruption. If they are--
if they have the right practices, they are Tier 1; if they are moving
towards the right practices, that is Tier 2; if they are not, they are
Tier 3, and there are consequences to Tier 3, consequences in our
bilateral relations, consequences in being able to participate in
certain types of programs.
Then lastly I want to mention the CROOK Act, which would establish
a fund available so that we could act quickly when there is an
opportunity to enact reforms against kleptocrats. I use Ukraine as an
example, and that may be a very sensitive issue at this particular
moment knowing what Russia is doing, but Ukraine missed an opportunity
to rid its society of the corruption that was systemic for many, many
generations. We did not act fast enough as an international community.
We are acting now. I have hope for Ukraine's future, but we need to
have funds available to be able to act quickly when the opportunity
presents itself internationally.
Therefore, I guess my message to this group is, thank you for
joining this international effort for parliamentarians' alliance
against kleptocracy. We can act as individual countries, and we need to
do that; we can act through our regional organizations, and I am very
proud of the work we are doing in the OSCE Parliamentary Assembly. We
are taking leadership as a collective regional organization, and we can
certainly work together in coalition with the Inter-Parliamentary
Alliance Against Kleptocracy.
I am proud to be part of your group, and thank you for today's
launch.
Mr. Massaro: Thank you so much for those opening remarks, Senator
Cardin.
We will now hear from six parliamentarians who are part of the U.S.
Caucus Against Foreign Corruption and Kleptocracy, the U.K. All-Party
Parliamentary Group on Anti-Corruption and Responsible Tax, and the EU
Parliament Intergroup on Anti-Corruption. Therefore, to start that off,
we will hear from Representative Malinowski.
After all parliamentarians have spoken, we will have an opportunity
for questions. When you do ask a question, you think of a question,
please think about the parliamentarian you would like to direct that
question to.
Therefore, let us begin with Representative Malinowski. Thank you.
Representative Malinowski: Thank you, Paul.
Great to see you, Senator Cardin, and all of the other members of
parliament from the United States. Joe Wilson will be joining us, my
Republican counterpart on many of these initiatives in the House, as
well as our colleagues from the EU and the U.K.
I would start by saying that this kind of gathering is Putin's
worst nightmare and the worst nightmare of every autocrat or kleptocrat
around the world who operates in that mode. It is for a couple of
reasons; one was mentioned by Senator Cardin, that corruption is the
reason for being for most authoritarian regimes. It sustains them. It
profits them. It is often the reason why dictators seize power. It is
very often the reason why they cling to power long after their time has
passed. However, I also think many of us have noticed that corruption
is the greatest vulnerability of dictators like Putin and Xi Jinping
and others around the world. Often these authoritarian leaders can use
patriotism and nationalism to whip up support for their regimes, even
when their regimes are repressive. However, there's one thing that
people around the world, of every country, of every culture
consistently refuse to accept and that is when their leaders steal from
their own people. When I have spoken to dissidents in authoritarian
countries and asked them how can the United States, can European
countries help them, they often have a very long list, but at the top
of the list is, at least do not help the people who are putting us in
prison by allowing them to hide their money in your banks, in your real
estate, as they have unfortunately been doing all too easily in a
number of European countries and, I am embarrassed to say, especially
the United States over the last several years.
Therefore, this is a profoundly important tool in our effort to
help democracy win the contest with dictatorship, which I think
President Biden believes and many of us on this call believe is the
defining contest of our time. When democracies come together to do this
we are at our strongest. The dictatorships of the world like to deal
with each of us individually. They like to divide and conquer,
particularly when it is small countries; like Lithuania right now is
undergoing tremendous pressure from China because this small European
democracy has dared to take a principled stand on issues that the
Chinese Communist Party would rather us be silent on. We have to stand
in solidarity together, and when we join forces on anti-corruption, it
becomes literally impossible for kleptocrats to hide anywhere.
Therefore, this week's Democracy Summit that President Biden is
hosting is a very important step in that direction. As Senator Cardin
mentioned, anti-corruption is a central theme of that meeting, and each
of our parliaments has legislation that would move this agenda forward.
Senator Cardin mentioned the problem of the so-called enablers, not
just banks but the real estate firms, the accounting firms, the public
relations firms, and the trust companies that have been set up to
enable kleptocrats to more easily hide their money, even as we've made
it harder to do so through the banking system. We have legislation in
the U.S. Congress, the ENABLERS Act, that would close all of those
loopholes in the United States, and this week, in the runup to the
Democracy Summit, the Biden administration fully embraced that bill and
committed to taking whatever steps it can on its own authority to close
those loopholes and to work with us to pass the necessary legislation.
Therefore, I look forward to working with all of my American colleagues
on this call to make sure that we do that in partnership with President
Biden.
With that, I will turn it back to you, Paul. Super grateful to
everybody for your leadership in setting up this coordinated mechanism
and look forward to working with you all to get some good laws passed
in the next year.
Mr. Mitchell: Paul, can I just interrupt, if I may? Andrew Mitchell
speaking, from London. Margaret Hodge and I are on a very, very tight
time limit. She has to go by 4:20 and I have to go by 4:25. Therefore,
if you want three minutes, which I believe is what we have been asked
to provide, from the British delegation, you are going to have to do it
fairly soon.
Mr. Massaro: Well, thank you very much for that intervention, and I
think that we should make that happen. Mr. Freund, would it be okay
with you to have the Brits make an intervention real quick before they
have to go?
Thank you.
Therefore, let us go ahead and hear from Mr. Hodge--Ms. Hodge and
Mr. Mitchell.
Ms. Hodge, are you available?
Ms. Hodge: Yes, I was just unmuting myself. Apologies for that, and
thank you so much. Thank you for taking us sooner, but we both have to
go. We are both expected to vote in our Parliament.
Can I warmly, warmly welcome this initiative? It is a great
initiative, so thank you to you for organizing it. Thank you to Ben
Cardin. Thank you to Tom Malinowski and Joe Wilson for the initiative
and leadership you have shown for this. We aare, certainly from the
British side, delighted to be with you.
I think I would make a number of points. First of all, illicit
finance, dirty money, lies behind a lot of other crimes. Therefore, in
tackling illicit finance and tackling the kleptocracy, we are also
dealing with everything from people smuggling to money laundering, from
drug smuggling to terrorism, and from fraud to corruption. Therefore,
the work we are doing is absolutely, absolutely essential.
It is our responsibility as lead voices in Parliament, in the
parliaments of the developed world, to tackle the evils of illicit
finance and corruption. It is our enablers, our corporate structures,
our property and luxury goods, and our services in the West that create
the rabbit hole through which the world's crooks and kleptocrats take
their stolen money and let it disappear. They then use their money to
clean reputations and to buy influence in our democracies. I think that
the final point is really important. I think the timing of this
initiative is absolutely appropriate, with President Biden's summit
starting in a couple of days, and also in the wake of the Pandora
Papers, which again demonstrated the extent of the evil.
From the U.K. side, I work with Andrew Mitchell. We are both on
different sides of the political divide, but we have worked incredibly
well together. We have managed to get legislation, despite resistance
from our government, on transparency in the U.K. offshore tax havens,
and that should be introduced in 2023. We are very vigilant to ensure
that they do actually go ahead with that. I have spent the last decade
in the U.K. fighting our role as a facilitator of tax avoidance and
illicit finance. I think we can learn a lot from each other. I am
delighted to tell you I worked with Deputy Prime Minister Dominic Raab
on Magnitsky legislation. We took that through the U.K. Parliament, and
we are now trying to see whether or not we can improve on the provision
that we enacted there.
There are three bits of legislation that I want to share with you.
Our group, with Andrew and myself at the helm, are arguing for a public
register of the beneficial ownership of properties in the U.K. because
it is--the properties that are owned particularly through the tax
havens--because that is a mechanism that is used by kleptocrats and
others to launder their money into the U.K. We are arguing--and that is
a sort of transparency measure. Transparency is at the heart of what we
need to do. We are arguing for tough relations with the reform of our
Companies House, which is where companies can get registered for a mere
12 pounds. They then set up a network of companies worldwide to move
illicit money into the legitimate system, and we are arguing strongly
for that. We are arguing for the introduction of a corporate liability
reform which will help us to get the enablers that my American
colleagues have talked about.
Therefore, I am grateful to you. I really look forward to
cooperating. If the democracies of the developed world cannot lead on
this, you know, I do not know what we are in the business of doing. I
am sure that we can share our experience, share our ideas, and actually
pursue legislation in our own national legislatures that will make a
difference and will clamp down on the growing kleptocracy that is
infecting our world. Thank you, Paul.
Mr. Massaro: Thank you so much, Ms. Hodge.
Mr. Mitchell.
Mr. Mitchell: Paul, well, thank you very much. Margaret, my
parliamentary colleague in London, has brilliantly set out the
position, so I do not need to take too much time. Let me just add a
couple of points. The first is that there is no question about the need
for this group. I congratulate you and our colleagues, in the EU and in
America on the Hill, on setting it up. I think it is a great idea and I
intend to play as full a part as you would wish in respect of that.
We, all of us, need, I think, to be quite self-reflective. You
know, Britain probably, through its overseas territories and its crown
dependencies and London, may be responsible for up to 40 percent of the
money laundering that goes on in the world. Therefore, we have much to
do to put our own house in order, and I had the great pleasure of
visiting America and meeting a number of senators and congressmen and
women, including your very powerful Senate Banking Committee, to talk
about the work that Margaret Hodge and I have done, imposing, first on
the British government through the majority in the House of Commons and
then on the overseas territories and crown dependencies, these open
registers of beneficial ownership.
It was very interesting to hear in America while you are not
embracing that sort of transparency, you are at least looking at closed
registers of beneficial ownership. For America to come on board that
would be a very, very good start, indeed. Bill Browder and the
Magnitsky Amendments--Bill is a good friend of many of us in the U.K.
Parliament. I think it is been a wonderful initiative and has more
steam in it not only in terms of other territories joining up but also
in the way in which it can be used against villains and felons.
The final point I make is just this, I have seen from my work in
international development, where I was the British Cabinet minister
responsible for international development for nearly three years, I
have seen the way money is stolen from the developing world, who need
it so much, by bent politicians and corrupt businesspeople. The
Paradise and Panama Papers showed us the extent of this web that the
bad guys have got. We need to box more cleverly in order to ensure that
we put a bit more heft on the side of the good guys so that we can
really crack down and make a big impact on this. Because, as Margaret
said, this money fuels the sex trade, it fuels corruption, and it is
theft by any other name.
Therefore, all are part of this group. There is a lot to do, and I
think within our own parliaments, we can try and make a difference.
Mr. Massaro: Thank you very much, Mr. Mitchell.
Therefore, now we will hear from Mr. Freund.
Mr. Freund: Well, thanks, Paul. Thanks, everyone, for coming
together for this wonderful initiative. Very glad to be part of this on
behalf of the Anticorruption Intergroup in the European Parliament. We
are basically about 130 members of parliament from 23 different
countries and six political groups. However, we all come together on
the idea of fighting corruption.
We all know that unfortunately, the European Union is no longer a
club exclusively composed of democracies. We have seen oligarchic
structures having reached unprecedented levels, including inside the
European Union. We have autocratic leaders, for example, in Hungary. My
colleague, Katalin Cseh, will speak about that in a minute, I guess.
All of this is actually fueled by EU money. Viktor Orban and his
immediate circles are taking a significant share of the 6 billion euros
that the EU is funding every year, including in public investment, in
Hungary to basically solidify their power structure and to enrich
themselves.
The European Commission, so far--which is supposed to protect
fundamental rights, democracy, also taxpayer money--is not taking
decisive action against that. Thus far, we do not--the commission--we,
here in the parliament, do not even have an overview of who actually
gets EU funds. We cannot see the benefits--the final beneficiaries of
EU-funded projects. Now that the United States is back on the
international stage, we welcome the signals that we got so far from the
new administration and feel that we can really have an impact
together--in the fight against corruption together with our
international partners.
Let me give you one concrete example. I was in Sofia, in Bulgaria,
in September. I met the interim government, including the finance
minister, and they told us quite shocking stories, I have to say. Bags
full of cash in the office of the finance minister, state assets being
looted, criminals with direct access to the previous administration,
the prime minister. In this political environment, well, the Americans,
and I am quoting our Bulgarian partners here, "dropped the bomb," the
Magnitsky sanctions against three oligarchs, one of them Vassil Bojkov,
known for bribing government officials and well-connected to Russia.
Therefore, I think the sanctions had a very desired effect--assets
frozen, criminal businesses being blocked. Indeed, the sanctions were
so successful that the interim government was telling us that they were
very openly hoping for a second round. This also shows, however, that
the Americans were doing it, but Brussels was not. Therefore, it once
again confirmed the European Commission's inaction. The democracy
summit was already mentioned. One EU member state was not invited to
the democracy summit, rightfully so. Orban used the possibility then to
veto a joint EU position sort of in retaliation. Therefore, commission
president von der Leyen, who is going to participate in the summit,
does not have a unified position of the 27 member states, because those
27 member states so far allow the autocrat in the room to call the
shots.
Therefore, this is exactly why this alliance of parliamentarians is
so much needed. I am very much looking forward to cooperating with all
of you on things like sanctions, corruption, investigations, and so on.
Because none of us can win this fight alone. Only if we work together I
think we stand a chance. That is why I am delighted that we are
founding this parliamentary alliance today. I hope that we can meet
soon also in person to discuss what we can do together. Thank you very
much.
Mr. Massaro: Thank you so much, Mr. Freund. I just wanted to remind
the audience to please put your questions in the chat and direct them
to the parliamentarian you would like to ask the question of.
We will now hear from Mr. Wilson.
Representative Wilson: Thank you very much. Ladies and gentlemen,
as the co-chair in the U.S. Congress of the EU Caucus and the U.K.
Caucus, I am so grateful to be with you today, with our colleagues from
the European Parliament and the British Parliament. Legislators have
had the fight against corruption and dictatorship as they led for years
in the past, and we need to continue. A new form of authoritarian rule
based on corruption has risen from the ashes of the failed communist
regimes. However, these dictatorships are, sadly, no less dangerous.
They rule through left and patronage and seek to export these same
systems abroad. During my numerous visits to Russia and China, I was so
impressed by the inspiring people I met. I regret that the leadership
of their respective countries has devolved into corrupt
authoritarianism.
I particularly grew up with an appreciation of China, as my father
served in the Flying Tigers in World War II and gratefully served with
Chinese colleagues to protect the cities of Kunming, Shantou, and
Xi'an. These autocrats now use their corruption strategically to
undermine our systems and pose a profound threat to all of our
democracies. It is time that we harden our system against the scourge
of corruption by crony capitalism. This is a bipartisan and cross-
border problem. Corruption is not limited to a particular country but
rather travels through networks across countries. That is why this
alliance is important.
The only way we can successfully achieve corruption fighting is by
harmonizing, as my predecessor MP Freund, mentioned. My colleagues and
I have worked to innovate in this space. Helsinki Commission Co-Chair
Steve Cohen and I have called for a polity of nonrecognition of leaders
who hold onto power through corruption--leaders like Vladimir Putin. We
have also pushed for legislation to counter Interpol abuse and the
abuse of other law enforcement systems meant to pursue justice, but
that are instead co-opted by dictators to pursue dissidents and
political opponents. I have worked with my colleagues to develop
tougher truth-in-testimony rules that will reveal the influence of
dictator payments to congressional witnesses.
Finally, we have focused on those who enable corruption--the
lawyers, the lobbyists, and others--who take the blood money of
dictators to help them achieve their aims. These policies will work if
we pursue them together. Russian oligarchs and Chinese Communist Party
operatives will always seek out the weakest link. If the money
laundering laws are strong in one country, they will go to where they
are weak. If enforcement is aggressive in one country, they will go to
one which is lax. However, if we work together to close the loopholes,
we can deny autocrats and their cronies access to democracies and cut
off this vector of influence.
I look forward to hearing from the colleagues about their
initiatives and goals, and their vision on how legislatures can work
together to curb corruption. The resiliency of our democracies relies
on our cooperation. Thank you for your attention, and I yield back.
Mr. Massaro: Thank you very much, Mr. Wilson.
Therefore, now we will hear from Ms. Cseh, please.
Ms. Cseh: Thank you very much. Thank you very much to all of your
colleagues who made it possible to talk on this very crucial issue. I
am very grateful to be able to address you today from the European
Parliament in Brussels. I think it is high time for a meeting just like
this to launch an Interparliamentary Alliance Against Kleptocracy and
to join forces as a transatlantic--[inaudible]--of legislators.
I believe this is a truly unique chance to make real progress on
this very global challenge because I believe that corruption and human
rights abuses are just two sides of the same coin. The two are
inseparable. Autocrats and oligarchs oppress their people so that they
can enrich themselves. Then they are stashing money abroad so they can
continue oppressing their people. This is a vicious cycle, and they are
desperately grabbing onto power because they want to escape prosecution
for corruption.
Therefore, we, as legislators, have to keep that in mind always,
all the time. I strongly believe this is our only chance to effectively
combat authoritarianism. This is on the rise, and I see that as a
global trend. I am a first-term legislator in the European Parliament.
I am an opposition politician from Hungary, and unfortunately, in my
country the situation that happened under Viktor Orban's government--
basically, my country has become synonymous with democratic backsliding
thanks to the leadership, that we hope to change next year. I also
witnessed firsthand how systemic corruption goes hand-in-hand with
democratic backsliding.
Of course, the breakdown of the rule of law might be an abstract
concept, but then again it is also something constituents can
understand very easily. For a lot of people, it means that development
funds never arrive in the poorest communities, but instead end up with
a well-connected family member or maybe the prime minister's son-in-
law. That happened in Hungary. It also means that jobs and life chances
are decided upon political loyalty. This is not only deeply unjust, it
also destroys economic growth in the long run.
Therefore, creating a rule of law sanctions mechanism on the
European Union level was one of the top priorities of this parliament.
However, I believe it has to go further, and we have to go further
together. We need effective instruments, and we need to work together
with like-minded democracies to also coordinate these tools. This is
why this parliament was very happy to hear about President Biden's
democracy summit, coming up this week. We also believe that the fight
against corruption has to be front and center in this fight.
I, myself, am the European Parliament rapporteur on a set of
recommendations on corruption and human rights in third countries. The
parliament's priority in these recommendations is to create effective
EU-level instruments and a strong sanctions framework that also
includes corruption as a punishable offense. It is not widely known
that it is still an important shortcoming. All of the major democracies
sanction corruption. You all know that the U.S., Canada, and recently
the U.K. Thus far, the EU are the only ones missing, and I believe this
is not only a minor policy detail. If we continue this way, the EU is
risking to become a safe haven for dirty money.
Autocrats and oligarchs who are fighting over sanctions in the city
of London, for instance, basically see a billboard here saying: Bring
you money here, and it is safe here. It is the only place in the West
where they will not be sanctioned. This is absurd, and I think we need
to change that. Coordinated sanctions are so much more efficient than
each country going their own way. However, it is also a priority for
the EU to create a strong corporate due diligence-type instrument to
target the financial infrastructure that is underpinning global
corruption, or, in other words, the enablers of global corruption.
It is clear that all parliaments and governments need to work
together on this. If we improve the cooperation and the exchange of
information between our law enforcement agencies, then we can fight
crime more effectively. I hope that our alliance is the first step in
that direction. Thank you very much, and I am very much looking forward
to working together with you.
Mr. Massaro: Thank you so much, Ms. Cseh.
Therefore, finally we actually have an additional guest, another
European parliamentarian, Ms. Wolters. Therefore, we want to--we want
to let you--give you a chance to speak. After that, we are going to see
if we can get through some of these questions. Therefore, please put
your questions in the chat. Then we will end either at one hour sharp,
or when we run out of questions. Therefore, Ms. Wolters.
Ms. Wolters: That is very kind of you. I was not expecting to
speak, but I am happy to. I will keep it brief. However, I think Daniel
has described quite well that in the EU, of course, we are in a rather
particular situation, in that I do not think the EU was ever designed
with the idea that we would end up with strange bedfellows internally
within our system. I think the EU system was built with the idea very
much in mind that we were a group of like-minded states that could
depend on each other, that could depend on each other's democracies and
rule of law being in order, and alas, we are not in that situation
anymore.
As he said very aptly, and so did my colleague Katalin, who
experiences results of this, you know, on a daily basis, we are in a
situation not only where we have strange bedfellows internally, but
where they are able to use the very money that is supposed to make our
union more effective and better for citizens to enrich themselves and
line their pockets. All of these issues, it was mentioned before, are
very much interlinked. We have issues of subsidies, of rule of law, of
corruption, and autocrats.
I think that--it was said by one of the previous speakers, as
parliamentarians we have a role to lead, as difficult as it might be.
Also to organize ourselves internationally. I think we need to lead on
this and create--and explore creative avenues for doing that.
Internally in the EU, given that we are a club of 27 member states that
on these themes often have to agree with each other for there to
progress, I think it is very welcome that we are exploring now how
internationally we can tackle some of these things if internally things
are proving to be difficult at the moment. After all, of course, if
crime is internationally organized, so should we be.
I will leave it at that. I am very grateful to those who have
organized this meeting. I look forward to cooperating with you, and I
know also that with Daniel and with Katalin's lead on this, we will be
in good hands from the EU side. Thank you.
Mr. Massaro: Therefore, thank you very much. Therefore, we have now
exhausted remarks, and we will move to questions. Therefore, please put
your questions in the chat.
Our first question is from Maria A. Marquez. She has a question for
Senator Cardin and Representative Malinowski. Therefore, we will start
with Senator Cardin and Representative Malinowski. If, Senator Cardin,
you are willing to take a question.
Therefore, this is--she is the founder of the initiative for the
recovery of Venezuelan assets. She is asking: Are you working on bills
that make it easier for victims, mainly the people of the countries
where money has been stolen, to receive the benefit of recovered
assets?
Chairman Cardin: This is a continuing struggle. We have been trying
to convince countries to have laws in regard to the recovery of funds
that have been inappropriately taken within their own country.
Therefore, we have been fighting this issue since World War II, in
regard to recovered corrupt assets. That battle is still continuing,
even dating back to World War II crimes. Therefore, the answer is, it
is a continuing battle.
We do have some domestic laws that deal with assets that we have
control over within our own country. We are trying to make those laws
more easily available. We would like to--it would be best if we could
work on a global response to try to develop international laws that
deal with recovered properties, and that, to me, would be a major step
forward. Clearly, we want to first trap those assets, be able to get
those assets, and then have a system where they can be returned to
their rightful possessors.
Tom may have some additional views on this. Let me--let me, if I
might, Tom Malinowski brings to the House of Representatives an
incredible wealth of experience working in the private sector, working
in the executive agency, and now in the Congress of the United States.
It really can, I think, give us some good guidance as to how we can
work in an interparliamentary sense.
Mr. Massaro: Thank you very much, Senator.
Representative Malinowski.
Representative Malinowski: Thanks, Senator Cardin.
Therefore, in addition to what Senator Cardin said, which I
wholeheartedly agree with, I would say that the U.S. government does
work quite aggressively to freeze assets when they are linked to
corruption. I think we could probably do a better job working in a
multilateral way, sharing intelligence with our like-minded partners so
that these are more often coordinated actions. I think we all agree on
the importance of countries acting in unison.
Finally, we have a bill in the U.S. Congress called the Justice for
Victims of Kleptocracy Act, a bipartisan bill that basically says that
when the U.S. government does freeze a kleptocrat's assets, that this
should be publicized so that the victims know. If we seize, you know,
assets of a corrupt general in Nigeria or a kleptocrat in Russia, or
what have you, we want the people of those countries to know that we
have done it.
Again, that is a bipartisan bill. We do need to work a little bit
harder to get it across the finish line. I am looking at my friend Joe
Wilson on this one, who is a strong supporter and a co-sponsor of this
bill. Joe, we need your help a little bit with some of our committees
in the House, to get your friends to clear this bipartisan bill.
Therefore, I am taking advantage of this call to try to move that good
piece of legislation forward. Thanks.
Mr. Massaro: There it is, folks. Politics in action, right here,
live. Therefore, the second question we have is addressed to all
panelists, but I am going to throw this one to Mr. Freund. That is,
from James Cohen, the executive director of Transparency
International--an organization I think we all know in the various
chapters in different countries. However, this is Transparency
International Canada.
Asking: Are there goals to expand this network to other
democracies, such as Canada?
Mr. Freund: Well, I think our club is open to all parliamentarians
who share the goals of this alliance. The more we are, the broader we
represent democracies that want to fight corruption and money
laundering and the tax on our liberal values, the stronger we are.
Therefore, I would very much welcome our Canadian colleagues in the
alliance as well. Good to see so many former colleagues from
Transparency International--at this meeting.
Mr. Massaro: Great. Thank you so much. Therefore, another TI guy
and also former U.K. parliamentarian, Duncan Hames, policy director
over at U.K. TI, asks another question.
Therefore, he asks: Anticorruption efforts too often assume no
countermeasures from corrupt actors. Now we have this exciting
international parliamentary alliance. How can we best ensure members of
our legislatures are resilient to interference from kleptocratic
regimes and their cronies? A good question, although Duncan did not
specify a parliamentarian. Therefore, given that Representative Wilson
and Ms. Cseh have not had a chance to respond yet, I just wonder if
there is any interest from them to respond, or any interest from any
parliamentarian to respond.
Representative Wilson: Indeed, Paul. I look forward to working with
our colleagues across Europe. Particularly we certainly need to include
our Canadian friends too, and neighbors. By working together and
identifying efforts that can be successful--and we have had past
success with the leadership of Senator Ben Cardin. I look forward to
working with Congressman Malinowski too as we identify legislation and/
or initiatives, working with different federal agencies on every level.
It will be a positive experience.
Mr. Massaro: Excellent. Well, thank you, Mr. Wilson.
Therefore, that exhausts our questions. Any closing remarks? Ms.
Cseh, yes?
Ms. Cseh: Yes. If I could just jump in for a last question. Just a
brief comment. Therefore, I believe that interference is really
something that we should take very seriously, no matter where we are in
the world. I am more familiar with the EU context, but there may be
some things that could be globally applicable. I believe that we should
be much more vigilant when it comes to vetting, for instance, people
who work for our members here in the parliament.
I am very saddened to see that--I am on the foreign affairs
committee, for instance, and the human rights committee. The colleagues
who work with us very often undergo almost no special vetting, even
though they are dealing with highly specified documents. There were
noted cases in kleptocratic governments that basically planted people
in far-right populistic politicians' offices here in Europe. I think
this is something really, we have to take seriously.
Another thing is much, much higher transparency requirements
regarding meetings, regarding declaration of interests, and more strict
revolving door rules, applicable to those who work in institutions or
work for parliamentarians. There are bodies in the European Union, for
instance, such as the European Council, which is basically a black box.
The meetings, not even the agenda of the meetings, are public very
often. We do not know what happens there. Therefore, greater
transparency can be a deterrent for those members who might be prone to
interference, in a way.
However also, I think, cybersecurity is also another issue that we
have to take very seriously about parliaments. Hacking, malware,
phishing--these are practices that are very often run--being run by
those governments who want to interfere with our democratic actions
coming from kleptocratic governments. However, these are just some
ideas to throw in. Maybe there are some more specific examples from
others.
Mr. Massaro: Okay. Well, thank you all so much for joining us this
morning. The Interparliamentary Alliance Against Kleptocracy is now
officially launched, and of course, now the hard work begins.
Therefore, thank you again, and we will close there. Goodbye.
[Whereupon, at 11:45 a.m., the event ended.]
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