Tackling Corruption


Whenever Australians think of corruption, they tend to identify it with police, politics and organised crime. As serious as that scenario might be, the hidden inroads of corruption go much deeper.

With moves underway, at least at a federal level, to face up to the problem of corruption, its wider significance may receive long-overdue attention.

No authority has ever sought to tabulate the true extent of corruption in Australian society.

A succession of Royal Commissions and other special inquiries have served to highlight graphic examples of it.

Much of the exposure and investigation of corruption has been ad hoc, unlike the approach in some other countries, where permanent anti-corruption authorities have been established.

In the wake of public concern over judicial and other instances of official corruption, the Federal Government in 1986 began considering options aimed at setting up a special national agency to combat corruption of public officials.

If a national agency is established, State Governments may be encouraged to do likewise.

The move is being sponsored by Mick Young, Special Minister of State who is ministerial head of the Australian Federal Police and chairman of the inter-government committee responsible for the National Crime Authority.

A Federal anti-corruption agency was nominated as part of a package of options being promoted by Young.

An alternative being considered was a proposal to designate a special division within the AFP to specifically target corruption problems and liaise with auditors, inspectors and internal security staff already attached to most Federal departments and instrumentalities.

As a first step, Young acted to introduce what he called ‘crime impact statements’ as a requirement for all submissions to Cabinet for legislative or departmental changes.

Not unlike an environmental impact statement, a crime impact statement is designed to force each ministry or department to assess the vulnerability of any proposal to crime or corruption.

Young maintained that the scope for fraud or corruption could be minimised by closer scrutiny over weaknesses in legislation and departmental regulations and practices.

According to Young, governments could not continue to pass laws without thought for any opportunities they might present for criminal activity.

He says: ‘We need to take into account the possible effect of legislation on the occurrence of organised crime and ability of criminals to circumvent legislative prohibitions.’

The adoption of a government offensive to identify and counter corruption problems — and thus avoid political embarrassment inherent in a defensive approach — was reported to to have the support of the Prime Minister, Bob Hawke, and the Deputy Prime Minister and Attorney-General, Lionel Bowen.

Unpublicised, an independent agency to tackle corruption had been considered by the previous Federal administration when Malcolm Fraser was Prime Minister.

The interest of the Fraser administration was acknowledged in a book on the history of Hong Kong’s famed Independent Commission Against Corruption distributed by the Hong Kong Government. However, the Fraser Government was preoccupied with seeking to establish a national crime commission which has since been implemented by the Hawke Government as the National Crime Authority.

The NCA’s declared aim is to take ‘effective action to combat organised crime in Australia’. In doing so, it inevitably also touches upon corruption involved in aiding drug trafficking and other rackets.

But under Young’s proposals there would be a separate ‘national corruption authority’ with a wider charter to seek out and tackle any form of corruption involving Federal jurisdiction.

Young visited Hong Kong to study the concept of the ICAC, and was also impressed by the State of New York’s Commission of Investigation during a visit to the United States.

He has since been one of the few ministers of any government to publicly speak out on the extent of corruption in Australia.

Apart from general corruption within elements of the private sector, he acknowledged that ‘high profits of crime often lead to corruption of the judiciary, law enforcement and executive arms of Governments’.

‘The fact is,’ he says, ‘almost every significant group in our community has played its part in nurturing crime. The lawyers with their advice, the accountants with their tricks, the politicians by their greed.’

One of the options being promoted was a national agency along the lines of the world’s biggest and best known agency — Hong Kong’s Independent Commission Against Corruption.

Established in 1974, the ICAC maintains regular liaison with Australian law enforcement agencies, especially the Victoria Police Force. Each year, a Victorian police officer is selected to attend ICAC training courses in Hong Kong and similarly many ICAC staff have attended organised crime analysts’ courses sponsored by Victoria’s Bureau of Criminal Intelligence.

Experts from the ICAC have also worked with the National Crime Authority on investigations into Chinese triad syndicates operating in Australia, as well as an inquiry into Australian links with a horse race fixing racket in Hong Kong.

Just as inquiries into organised crime rackets invariably lead to the uncovering of instances of corruption, conversely the ICAC has found that its investigations into corruption have led to the unravelling of organised crime syndicates.

The ICAC was originally set up in response to a public outcry over syndicated police corruption in Hong Kong. But its charter was broadened to target all forms of corruption.

During its initial years, nearly half of the corruption cases it dealt with involved police.

Now in its second decade, the commission finds that only one in 10 prosecutions involves police officers.

The commission receives more than 2000 reports of corruption each year. On average, more than 400 inquiries lead to prosecution.

Out of 410 persons prosecuted during the last 12 month period for which figures are available, only 42 were police officers, 311 were private citizens (mostly charged with offering bribes to public officers) and the remainder public servants or employees of public bodies.

The most vulnerable government areas included housing and public works administrations.

With Hong Kong’s population around one third of that of Australia, its budget for the ICAC is more than $25 million a year, three times that of Australia’s NCA. The ICAC’s staff of nearly 1200 is six times that of the NCA.

Under powers which have been described as draconian, the ICAC can tap telephones, search premises and arrest persons without warrants, seize records and detain suspects for up to 48 hours.

Suspects can be forced to submit to compulsory interrogation under oath.

In dealing with public servants, commission officers can enter any government office and demand access to any records and documents, including standing orders, directions and office manuals.

Although the ICAC is bigger and better known, a similar body in Singapore, known as the Corrupt Practices Investigation Bureau, is credited with being more successful. It was established in 1952 and was used as a model for the ICAC.

As with the ICAC, the CPIB does not investigate organised crime matters, concentrating instead on both public and private corruption. It has similarly wide powers.

It has a staff of only 52.

In Malaysia, an organisation known simply as the Anti-Corruption Agency (previously the National Bureau of Investigations) concentrates on investigations into corruption practices.

It, too, is not charged with investigating drug trafficking or other aspects of organised crime, ‘unless they are connected with bribery and corruption’.

It has a staff of more than 800.

Recognition of the fact that serious corruption problems extend beyond that associated with organised crime is exemplified by the development of special investigatory machinery by authorities of New York — the veritable heartland of syndicated racketeering.

In 1951, a crime commission was established for New York State by Governor Thomas E. Dewey, at that time to probe ‘generally the relationship between organised crime and any unit of government anywhere in the State’.

By 1958, the commission was expanded into the State of New York Commission of Investigation, aimed also at the conduct of public officers and public employees, and of officers and employees of public corporations and authorities, ‘not limited to organised crime and racketeering’.

It has a permanent staff of 60. However, it co-opts teams of detectives from the State’s police force for particular investigations.

A selection of cases from its published reports indicates the wide sweep of its operations: collusive tendering, government purchasing practices, sales tax rorts, bingo rip-offs, misconduct of mayors, manipulation of elections and bribery of legislators, discipline of the judiciary, improper use of union funds, frauds in electricity, road, sewerage, garbage, housing, hospital and rehabilitation undertakings.

Apart from the State commission, there is a separate Department of Investigations charged with detecting and eliminating fraud and corruption within the New York City administration.

Its cases fall into similar categories: bribery and bribe receiving, forgery of city cheques or official documents, impropriety in the awarding of contracts, and gross mismanagement or negligence in wasted city resources.

It alone deals with more than 2000 complaints each year.

Over a four-year period, the department was involved in the indictment of 559 individuals. The combined amount from theft and bribery attributed to them totalled $US9 million.

Over a similar period, according to the department, through a corruption prevention bureau, it ‘identified more than $US40 million worth of preventable monetary losses to the city due to corruption and has successfully blocked opportunities for fraud or mismanagement in the city’s collection of revenues, the purchase of goods and services, and the administration of social programs’.

The New York anti-corruption measures have been extended even further in recent years to include what is termed the Office of Inspector General. Inspectors are assigned to each mayoral agency to investigate ‘corrupt or other criminal activity, conflicts of interest, unethical conduct, misconduct and negligence’.

In NSW, where politics has been bedeviled by perennial allegations of corruption, a separate police unit began operations at the end of 1984 to clean-up entrenched corruption within that State’s police force.

There has been no sign of any move to attempt a similar clean-up in other areas of government administration.

However, a parliamentary researcher, Garry Sturgess, an adviser to NSW Opposition leader Nick Greiner, undertook a major study in 1986 aimed at an overall strategy should the Liberal-Country Party coalition gain power in 1988. The Liberal Party subsequently pledged that a State anti-corruption agency would be established.

More than two years previously, the ALP administration of Premier Neville Wran purported to establish a special agency to deal with general complaints of corruption, when Wran announced the establishment of a Commissioner of Public Complaints.

It was promoted as an election pledge by Wran at the NSW election of February 1984, forced upon him during a public furore over corruption allegations stemming largely from the Age Tapes affair.

Once the election was over, and the Wran administration returned to power, the so-called anti-corruption initiative was implemented in the form of what Wran himself dubbed a ‘put-up or shut-up measure’.

In the following two years, the Commissioner for Public Complaints was conspicuous for NOT pursuing any corruption allegations. This was not surprising, since it was structured to deter complaints of corruption.

When enabling legislation was being passed, its nature was spelled out by Barrie Unsworth, the Wran administration’s leader in the NSW Legislative Council. As Unsworth explained it, the legislation gave ‘all the powers of a Royal Commission in relation to the complaint. The complainant can be compelled to produce documents and to give self-incriminating answers to questions . . . the situation is that only the complainant can be called in accordance with that provision. No other witnesses could be called’.

In a nutshell, it was a complete sham.

When Wran resigned suddenly in June 1986, and Unsworth took over as Premier, there was speculation on what he would do with this supposed anti-corruption agency. The answer was nothing, since it was found that under a sunset clause it had gone out of existence the week before Unsworth took over anyway. But Unsworth and his Attorney-General, Terry Sheahan, did later move to establish machinery to deal specifically with allegations of judicial corruption.

Establishment of special Federal and State anti-corruption agencies was first advocated for Australia in mid-1985 by Vic Anderson, on completion of his two-year term as director of the Australian Bureau of Criminal Intelligence. As he put it, Australians for too long had looked to Royal Commissions or other forms of judicial inquiry when allegations of corruption had been raised. Instead, he said, there should be in place a permanent system, not only to deal with complaints or allegations of official corruption as they arose but to seek out corruption before it became entrenched.


from Connections 2 by Bob Bottom