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74COMPARATIVE STUDY OF LEGAL ASPECT OF PREVENTION AND FIGHT AGAINST CORRUPTION IN RUSSIA
V. Konakov Master of Economics, an independent expert on Management,
Finance and Law
Summary: The fight against corruption in Russia is gaining momentum: in the
past years a series of regulations aimed at improving measures to detect and prevent crimes related to the use of official position for personal gain were enacted. Author examines psycho-judicial and socio-economic characteristics of the phenomenon of corruption in Russia, makes an attempt of a legal-terms analysis of the newly adopted acts, presents a comparative study of legal aspect of improvement of legislation in this area.
Keywords: administrative reform, shadow economy, corruption, official
malfeasance, anti-corruption expertise, comparative law aspect.
During the 20-year period of formation and development of a new socio-economic and constitutional order of Russia there was enacted a huge number of legal instruments for the detection and prevention of crimes related to the use of official position for personal gain. The years have passed since their adoption, but even today it is difficult to appreciate the real contribution of the lawmaking in the fight against corruption and in the development of the appropriate legal institutions in this field. However, experience obtained in Russia can be useful for the purpose of improving the legal regulation in other countries.
Comparative Legal studies
THE EXTENT OF CORRUPTiON AND iTS iMPACT
ON RUSSiAN SOCiETY
Analysing the conditions of the existence along with ways and methods of combating corruption, V.D. Andrianov1, put an interesting approach suggesting by the following types of corruption: administrative, business, associated with the «captivity» of state2, political.
Under the administrative corruption investigator understands the deliberate distortions into the process of making the prescribed implementation of existing laws and regulations in order to provide benefits to parties concerned. He also provides estimates of the scale of this type of corruption in the CIS countries: about 3.7% of the gross annual income of companies (for small businesses this figure is almost three times higher). This suggests a very high level of administrative corruption impacts on the economic development of the entire sector in Russia: with an average return on sales of 9.6% Russian companies have to «allocate» for these purposes more than 40% of their profits, so taking into account the 30% share of the corporate sector, suggested losses could amount to 30-40% of the total GDP of Russia.
Since a significant portion of the financial resources of administrative corruption is illegally withdrawn abroad or used for other criminal purposes, this phenomenon is of an extremely high risk to the social development of Russia. At the same time, it is obvious that the reduction of administrative corruption even at a fraction of a percent can lead to higher rates of growth of the national economy. So improving the anti-corruption legislation in the administrative, procedural and other related areas of the law will lead to an improvement in the socio-cultural conditions of life of the majority population.
As opposed to administrative corruption, which is a distinctly permissive, business corruption occurs in the interaction of business and authorities and manifest itself in the form of fees for state and municipal employees from benefits Arms. According to the State Statistics Committee of Russia there were about 145 thousand crimes in the Russian economy in 2011, of which about 33 million were committed in large and extra large size. Thus the effect of bribery as a result of business corruption can be very high, because it allows someone to accumulate significant amounts of illegally obtained money «in the same hands». Such conclusions are supported by the media materials, according to which the average size of bribes in the most corrupt departments of Russia
1 Andrianov V.D. Opyt zarubezhnykh stran po borbe s korruptsiej [Foreign Countries Experience in the Fight agains Corruption] // Obshchestvo i ekonomika [Society and Economics]. 2001. № 1. C.1-5
2 “Captivity of the state functions” would be more exact.
3 Course of lectures of V.A. Prokoshin.
reaches 630,000 roubles (US$ 21,000). Business corruption can be considered as the most important component of corruption in Russia, so to «break the back» monster of the shadow economy and to reduce the extent of penetration of corruption in key areas of public and business life of the population is possible only with the strengthening of the investigation and search operations and crime prevention measures, with the improvement of anti-corruption mechanisms of interaction between state and society along with the legal awareness of the population.
In turn, the corruption associated with the capture [of functions] of the state
uses a variety of methods of influence on the formation of laws, regulalations and other policy instruments to an unfair redistribution of state property and funds. To imagine the destructive power of the negative consequences of this type of corruption is made possible by wording of V.A. Prokoshin: «the growth of corruption was contributed by the fact that equal rights and opportunities of all sectors of Russian society to participate in the privatization had not been provided with the law so the principle of social justice was not respected». It should be noted another excellent point, stating that «one can not ignore the psychological aspect that characterizes the ongoing psycho-judicial processes against corruption in the economy»3.
Indeed, this type of corruption appeared largely due to psychological unpreparedness of the population, the lack of the required elements of legal awareness, as well as the complete absence of any law enforcement practice in this field. As a result, more than contrast differences in the spectrum of psychological and moral qualities of the individual classes have led to a situation commonly called «grab-what-you-can privatization», and the mechanism of privatization itself began to work by the rule of «who was in time, and then eaten». Even in the capital of Russia, most people do not have a clear idea of where to put their voucher, while the representatives of the Russian ruling elite could not find or just did not try to look for ways to improve situation4.
The conclusion is obvious: the huge scale of corruption in Russia is the result of poorly thought-out government policies in the area of privatization of public goods along with the lack of relevant legal rules and institutions, while their presence would significantly reduce the potential for abuse in this field.
Political corruption involves the use of corruption mechanisms to achieve their national (above all - political) interests in other country. This phenomenon is
4 As the former Vice-Prime Minister told: «we need just to close our eyes and jump into uncertainty». Gaidar E. Pryzok k rynku [Jump toward Market]// Pravda. 1990. Apr. 16.
5 “On the Measures on Realization of Certain Clauses of the Federal Law “On Counteraction agains Corruption” and “On the Measures on Realization of Certain Clauses of the Federal Law “On Supervision under Equivalence of Expenses of Persons taking Government Positions and Some Other Persons to their Incomes”
Comparative Legal Studies
not new. Today, however, political corruption in many ways lives through the processes of globalization, and the achievement of corrupt interests occurs with the use of financial resources coming from abroad through an intermediary (or, as we now call «foreign agent»), whose role is played by non-profit (public) organizations. In an interview with German media group ARD of April 6, Russian President Vladimir Putin said that «only four months after we adopted a law there came from abroad ... almost US$ 1 billion on the accounts of these organizations». However, only 855 million roubles (about US$ 30 million, or 3%) received through diplomatic missions.
Political corruption as its special form has only recently attracted the attention of the Russian legislature, whereas in other countries such as the United States, legislation like it is valid from 30-ies of the last century. Besides, the registration and monitoring of the activities of «foreign agents» in the United States, as now in Russia, is executed by the Ministry of Justice, and all this is done by virtue of the NPO statement. However, the penalty for the offense in the United States may be more severe - alongside with a fine, imprisonment for up to 5 years is possible. Questions of political corruption are pressing today for other countries too: for example, the number of lobbyists of the EU in Brussels is estimated at 15,000 people, so one of the deputies of the European Parliament has recently proposed to oblige his colleagues to publish their lobbying contacts, regardless of the form in which they are being paid. Another example is the fact of a legal payment of salaries to Georgian officials by the Foundation of American billionaire G.Soros that periodically causes indignation of the population of Georgia.
Law enforcement practice in the fight against corruption in Russia
Diverse strata of the people participate in domestic debate on the mechanisms and methods of prevention and fight against corruption in Russia, and that has led to a number of anti-corruption laws and regulations. «The first swallow» was the Federal Law of December 25, 2008 No 273-FZ «On Counteraction against Corruption».
Then followed the Federal Law of December 28, 2010 № 403-FZ «On the Investigative Committee of the Russian Fedaration», and a relevant Presidential Decree was signed. These acts make provision for the creation of a Russian investigative body, independent of the other branches of government. Investigative authorities prescribed to this body, as it was intended, were a continuation of those of the President, and they can be considered as an element of checks and balances in the system of separation of powers. Further activity of the Investigative Committee of the Russian Federation led to the prosecution on a number of high-profile cases, containing the signs of corruption, including charges against: several high-ranking officials in the main supervisory authority of the country on charges of bribery; high officials of the company, directly controlled by the Ministry of Defence on charges of “fraud”, “abuse of power”, “abuse of office”, “abuse of
authority”; several oppositioners on charges of “preparation of a crime and attempt to commit a crime” and “mass riots” (here the elements of political corruption have been seen).
Changes were made to the Federal Law “On Non-Profit Organizations”, according to which in the case of foreign funding, NPOs have the duty to supply the relevant application for the inclusion of the organization in the “Register of Non-Profit Organizations Acting as a Foreign Agent”. Apparently, the American legislation had been taken as a basis for making changes in the Russian act. As a legal consequence the Ministry of Justice began proceedings entailing administrative sanctions against officials of the Association “Golos” (Voice).
Another set of regulations of 2008-2013 led to such legal consequences as the revocation of the deputy credentials of several members of the State Duma (Parliament) on suspicion of “illegal participation in business activity”.
Russian legal practice of recent years presents examples of complex multiplier effect of law enforcement of the entire mass of anti-corruption legislation on offenses in this area, for example, the dismissal of a number of metropolitan officials suspected of receiving bribes for issuing diplomas and certificates of education.
Strengthening of the powers of government agencies and departmental committees, as well as the formation of new structures to monitor the income, expenditure, assets and liabilities of public officials has become an important factor. It should be noted that the enacting large volume of anticorruption regulations during 2008-2013 turned to be an integral part of the ongoing administrative reform and affected the interests of virtually the entire system of government.
Analysis of a number of distinct trends of Russian law-making and law enforcement in recent years can be of practical importance for the purpose of improving anti-corruption legislation.
Birth of these trends considered to be in 2008, when the President of the Russian Federation signed the abovementioned Decree that approved the measures on counteraction against corruption, as well as the Federal Law that defines the basis for such counteraction. In all during the period 20092013 more than 40 laws and regulations (mostly of bylaw character) were enacted in this field.
Special attention should be paid to the April 2, 2013 Presidential Decrees No 309 and 3105, that authorized the Government Service and Personnel Department of the President's Administration to verify the accuracy and completeness of information about income and property of any official (with spouse and their under age children) who are obliged to provide such information.
Comparative Legal Studies
In view of the aforesaid, two key features of the Russian legislative and law enforcement of recent years are clearly reveal: the first, the improvement of anticorruption legislation in the Russian Federation has a distinct character of by-law, and the second, “extension” of the vertical of public authorities with competence in the anti-corruption field is clearly manifested. This is expressed in the legislative consolidation of the vertical going down directly from the Government Service and Personnel Department of the President's Administration, that received the absolute powers at the anti-corruption field.
Referring to the international experience, it should be noted that these features are not unique for Russia. For example, a real political earthquake was after the confession made by the former French Minister for the State Finances about his accounts in Swiss and Singapore banks, while he himself aggressively urged entire EU to fight resolutely against money laundering and tax evasion. Immediately after French President F. Hollande announced the need to prepare a draft law on the establishment in France “financial prosecutors” and a draft decree on the creation of the “office on fraud and corruption” in April 2013. Such experiences have already been successfully implemented in some other countries - for example, in Singapore (the least corrupt country in the world), where the Bureau of Investigation of Corruption was established in 1960.
pREvENTioN of CoRRupTioN-RELATED oFFENSES
Establishment or alteration of the penalty for a particular violation of the rules or standards of behavior lets us talk about the features of the national policy on the prevention of crime in a specific area. It is noteworthy that despite the growing number of corruption charges brought against officials of the highest official level, as well as growing of the monetary value of bribes and corruption damage caused as a result of, the Russian lawmakers at the end of 2012 approved amendments to the Criminal Code. For infringement of the clause 290 “Bribe” at the Criminal Code of the Russian Federation, they prescribed an alternative punitive measure in the form of forced labor or a fine instead of imprisonment. In my judgment, such a change of the law, as a matter of fact, mitigate the extent of criminal liability. Here we can see one of contradictions of the Russian legislation.
Other examples could be given, but in general, one can make a conclusion about a rather confusing government policy in this area, while the policy itself for the prevention of corruption is more like a “patchwork”, so that it remains unclear: when the number of anti-corruption acts develop into quality.
With regard to international experience, the situation here is ambiguous. For example, the Criminal Code of Canada, which has one of the world's lowest
levels of corruption, for consent to receive a bribe only one can get a sentence of imprisonment of 14 years. On the other hand, in the penal codes of Italy and Germany, where the level of corruption also considered to be low, criminal sanctions are similar to the Russian those: corruption, depending on their character is punished both with imprisonment and alternative penalty in the form of a fine at the rate of several amounts of damage.
And yet, in my opinion, the most effective measures for prevention of corruption should be raising the level of social sense of justice, along with a higher level of salary of civil servants, as well as ensuring the possibility of public control and efficiency of the judicial system - as the example of an effective system of prevention of offenses is Singapore, the least corrupt country in the world.
