Leading financial centres ‘must act on corruption’, says watchdog

According to the latest edition of TI’s Corruption Perceptions Index for 2014, which scores countries on a scale of 0 (perceived to be “highly corrupt”) to 100 (“very clean”), China scored 36 out of 100 compared to a score of 40 in 2013. Turkey’s score was 45, compared to 50 previously.

TI said “corruption is a problem for all economies, requiring leading financial centres in the European Union and US to act together with fast-growing economies to stop the corrupt from getting away with it”.

Of the 175 countries ranked in the Index, Denmark had the highest score of 92 (compared to 91 previously). Germany scored 79 (previously 78), the UK scored 78 (previously 76), France scored 69 (previously 71) and the United Arab Emirates scored 70 (previously 69). Somalia and North Korea shared the lowest score of eight, which was unchanged from 2013.

TI said Cote d’Ivoire (32 compared to 27 previously) and Mali (32 compared to 28 previously) were among the “biggest improvers”. More than two thirds of the countries in the Index scored below 50.

TI said that “top performer Denmark has a strong rule of law, support for civil society and clear rules governing the behaviour of those in public positions, it also set an example this November, announcing plans to create a public register including beneficial ownership information for all companies incorporated in Denmark”. This measure, similar to those announced by Ukraine and the UK, “will make it harder for the corrupt to hide behind companies registered in another person’s name”, TI said.

TI is calling on the EU, US and G20 group of nations to follow Denmark’s lead and “create public registers that would make clear who really controls, or is the beneficial owner, of every company”.

The Index is based on expert opinions of public sector corruption, TI said. “Countries’ scores can be helped by open government, where the public can hold leaders to account, while a poor score is a sign of prevalent bribery, lack of punishment for corruption and public institutions that don’t respond to citizens’ needs.”

TI said China’s score fell “despite the fact the Chinese government launched an anti-corruption campaign targeting corrupt public officials”. “The government has recognised the need to follow officials who hide ill-gotten gains overseas. This January, leaked documents revealed 22,000 offshore clients from China and Hong Kong, including many of the country’s leaders.”

Corruption and money laundering “are also problems” for the other nations that make up the BRIC (Brazil, Russia, India, China) group, TI said. “This year has seen questions raised related to a major oil company using secret companies to bribe politicians in Brazil (which scored 43 in the Index), questions about Indians (38) using bank accounts in Mauritius (54) and Russians (27) doing the same in Cyprus (63).”

TI chairman Jose Ugaz said: “Fast-growing economies whose governments refuse to be transparent and tolerate corruption, create a culture of impunity in which corruption thrives.”