To Combat Fraud & Corruption


  • UN Convention Against Corruption
  • To Combat Fraud & Corruption – A Cancerous Menace
  • With Mere Rhetoric Subverts UN Convention
  • By Nihal Sri Ameresekere
  • Published: September, 2011
  • Format: Perfect Bound Softcover(B/W)
  • Size: 8.25×11
  • Pages: 530
  • ISBN: 978-1-45679-673-0
  • Our Price : $99.00 ($79.00 + Shipping $20.00)

To Combat Fraud & Corruption – A Cancerous Menace With Mere Rhetoric Subverts UN Convention

An invaluable Book dealing with United Nations Convention Against Corruption (UNCAC), in force from December 2005, including its evolution, and related UN Convention Against Transnational Organize Crime. UNCAC – is an international legal instrument dealing with combating fraud, corruption and economic crime in public and private sectors, including political leaders and lackeys. Author discloses the formation of International Association of Anti-Corruption Authorities (IAACA), in Beijing in October 2006, with Inaugural Address by Chinese President, Hu Jintao. IAACA promotes and facilitates implementation globally of UNCAC, supported by United Nations Office on Drugs & Crime (UNODC). He reveals his endeavours to combat fraud, corruption and economic crime, prior to UNCAC. He demonstrates that whilst fraud and corruption, as endorsed by international research, is a major issue confronting people, how political leaders stride to power exploiting their anguish by committing to combat fraud and corruption, but once in power get bogged down in the quagmire of fraud and corruption, peddled by their lackeys, financing them. Disclosing real instances, he demonstrates how countries, having ratified UNCAC, are not honouring its obligations, but blatantly violating with impunity its obligations; he highlights dire need for international endeavour to deal with political leaders, pillaging and plundering the resources of people plunging them into abject poverty, as crimes against humanity.

SAARC leaders acknowledge people in Asia are enslaved in abject poverty, and propound prosperity is not monopoly of a few, but are not committed to combat fraud and corruption. He reveals how World Bank and international agencies pontificate on combating fraud and corruption, but continue to fraternize with fraudulent and corrupt miscreants, demonstrating that mere rhetoric, only subverts UNCAC – an indispensable handbook for those combating fraud, corruption and economic crime.

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The endeavours made by the international community to progress with negotiations, and the formulation of the UN Convention Against Corruption, which was adopted by the UN General Assembly by Resolution 58/4 on 31st October 2003, and entered into force on 14th December 2005, upon ratification by 30 countries, in terms of such requirement stipulated in the UN Convention Against Corruption.

Mr. Kofi Annan, United Nations Secretary-General, said upon the adoption of the UNCAC that:

  “Corruption hurts the poor disproportionately by diverting funds intended for development, undermining a government’ s ability to provide basic services, feeding inequality and injustice, and discouraging foreign investment and aid.”

In inaugurating the International Association of Anti-Corruption Authorities, the Key Note Address was delivered by President Hu Jintao of the People’s Republic of China, who was reported in the China Daily of 24th October 2006 emphasised that China was fully committed to fighting corruption, stating as follows:

 “We see the fight against corruption a top priority, a pressing task that has great influence on the overall development of the country, and which affects the fundamental interest of the people, equality, justice, social harmony and stability”

Dr. Ye Feng, Secretary General IAACA, in his Address –

As Mr. Antiono Maria Costa says, the implementation of the UN Convention rests firmly in the hands of States. But States need all these support of civil society and professional organizations. As a global issue, corruption should be combated globally. With the Convention entering into force, the need to efficiently implement its provisions has become more apparent. The establishment of the IAACA would be a milestone in the steps to be taken to further enhance international cooperation against corruption. Along with UNODC and other relevant international organizations, IAACA will be committed to the implementation UNCAC, so as to realize the value of the Convention to its maximum extent, by stimulating the necessary interaction among all the relevant international anti-corruption authorities form all countries around the world, with the view to improving their professionalism, integrity and effectiveness. “

It is indeed significant that India, which is known to be the biggest democracy in the world, ratified the UN Convention Against Corruption, only as late as 1st May 2011. Significantly, this was caused by a person undergoing the ritual of fasting – threatening to fast unto death, thereby creating a nation wide hue and cry and agitation against corruption, coercing the Government of India to ratify the UN Convention Against Corruption.

In the World Bank Staff Working Paper No. 580, on ‘The Effects of Corruption on Administrative Performance’, David J Gould and Jose A  Amaro-Reyes had reported thus:

  “Corruption … is pervasive in the countries of Asia, Africa and Latin America. The government monopoly of economic activities in developing countries, when combined with conditions of political “softness” widespread poverty and socioeconomic inequalities, ambivalence towards the legitimacy of government and its organisations and systematic maladministration, provides fertile grounds for corruption, which … has a deleterious, often devastating effect on administrative performance and economic and political development, for example corroding public confidence, perverting institutions’ processes and even goals, favouring the privileged and powerful few, and stimulating illegal capital export or use of nonrational criteria in public decisions.”

India’s neighbour, Sri Lanka had enthusiastically and willingly signed and ratified the UN Convention Against Corruption, as far back as 31st March 2004, having been the 2nd country to have ratified the UN Convention Against Corruption. However ironically, Sri Lanka is perceived to be deeply steeped in the quagmire of corruption, with the involvement of the upper echelons of society, with scant regard for the ‘rule of law’, and the absence of the warranted enforcement of the law by the relevant law enforcement authorities.

I attach Letter dated 13.6.2006 I addressed to the Indian High Commissioner in Sri Lanka, Nirupama Rao, now Indian Foreign Secretary  – extracts

  “On the other hand, could a sovereign government be subjected to threat and intimidation, akin to that  normally posed by labour unions, that too vis-à-vis a foreign direct investment of US $ 40 Mn. ?   

I address Your Excellency in the belief that Your Excellency is undoubtedly committed to the Gandhian spirit, that the ‘weaker’ ought not be subjected to coercion by the ‘stronger’.

Inasmuch as Your Excellency had so intervened, I urge Your Excellency to ensure that IOC fulfils forthwith its fundamental obligation and commitment to bring in the balance investment component of US $ 35 Mn. in foreign currency.”

Chief, Corruption & Economic Crime, UNODC, Dimitri Vlassis:

  “Moving to the work of the Mechanism, the Implementation Review Group held its first meeting in June 2010 and kicked off the first year of the current review cycle. Every State Party to the Convention will have an opportunity in the next 3 years to review its implementation of the Convention through a peer review process. As the Convention is the only global legal instrument against corruption, many States in regions that do not have regional or sectoral instruments in this area are being engaged for the first time in this work. This has contributed in turn to shrinking the safe havens for proceeds of crime and to raising awareness of the detrimental effects of the diversion of resources.”

Prime Minister Ranil Wickremesinghe’s Government, which assumed Office in December 2001, was disclosed to be fraudulent and corrupt, with several Judgments by the Supreme Court of Sri Lanka, on the Ranil Wickremesinghe’s Government’s unlawful, illegal and fraudulent deals. Ironically, he also appointed K.N. Choksy, President’s Counsel, as his Minister of Finance, regardless of his conduct and actions in the scandalous Hilton Hotel construction fraud on the Government of Sri Lanka, upheld by the Supreme Court of Sri Lanka, the highest judiciary.

To my Letter, I had attached the following Affidavit dated 29th August 1998 of then Minister of Justice & Constitutional Affairs and Deputy Minister of Finance, G.L. Peiris (now Minister of External Affairs), wherein at paragraph 8 of his Affidavit, he had specifically declared and affirmed to the Court of Appeal of Sri Lanka, as follows:

   “I state that documents in files maintained or kept in the Ministry of Finance / Treasury are not documents in my possession or power, as no power or duty pertaining to the subject of finance has been delegated to me under Article 46(2) of the Constitution by Notification published in the Gazette.”

This led me to pose the question to The World Bank, as to how Minister G.L. Peiris had been permitted to masquerade and did masquerade to represent the country, particularly with international financial institutions, committing the country on financial matters, devoid of a constitutional mandate, the absence of which he, himself, had admitted on oath to the Judiciary of Sri Lanka; whilst also at the same time he functioning, as the Minister of Justice & Constitutional Affairs !

The Hilton Hotel settlement resulted in the Japanese writing-off a colossal sum of US $ 207 Mn., i.e. Rs. 10,200 Mn. on claims made against State Guarantees.

However, in this instance, to both Foreign Minister Lakshman Kadirgamar and Justice Minister G.L. Peiris, this was a mere ‘irritant’. Minister Kadirgamar stating :

  “The finalisation of this settlement has removed irritants of an otherwise cordial relationship between our two countries. This is a very happy occasion for us, as we witness a closed chapter, which caused much concern for all of us”

and Minister G.L. Peiris stating :

  “Today marks a happy day for the government of Japan and Sri Lanka following the signing of the dispute settlement agreement, which was a constant irritant, which may have marred the otherwise healthy and strong relations, which Japan and Sri Lanka enjoyed over the years.”

To Japanese Ambassador, Yasuo Noguchi, as reported in the media, this was a ‘thorn’ in the economic relationship and an example of trouble they might face after investing in Sri Lanka. Clearly they were all unconcerned, that such ‘irritant’ or ‘thorn’ in the side was worth as much as US $ 207 Mn. i.e. Rs. 10,200 Mn. to this poor developing country of the South.

Charge de Affairs of the Japanese Embassy in Colombo Mr. I. Hashimoto had met the then State Secretary, Ministry of Foreign Affairs, Mr. R.C.A. Vandergert. Relevant extracts of a Note prepared by Mr. R.C.A. Vandergert on the discussions – viz:

“i.   Referring to the ethnic conflict and the expressed intentions of the Government to negotiate with the LTTE, he said he was ‘thinking aloud’ about what the reaction of the Government would be if Japan was to offer itself as a venue for talks between the representatives of the Government and the LTTE. He thought that such a meeting away from the public glare, might provide a conducive atmosphere for such talks. I replied that he should make this proposal to AIR since these matters were being handled by the Presidential Secretariat.  

Mr. Hashimoto also brought to my notice the concern of the Government of Japan and Japanese investors in regard to the Hilton Hotel dispute. He said that in view of the importance which Sri Lankan Foreign Policy attaches to attracting foreign investment, the Government should look at the overall impact which disputes like the Hilton Hotel dispute would have on Sri Lanka-Japan bilateral economic relations and, more particularly, the adverse impact it may have on Japanese investors who might feel that in situations of this nature, the government was not doing enough to help resolve such issues. Since the overall loser would be the country itself, he thought that in matters like this the Government should become more involved, without leaving it to private arbitration or even negotiations conducted by BOI etc. I said I would convey his concerns to the appropriate authorities.”

Could representations made by a person of such standing, as US Ambassador Peter Burleigh, have been relegated and described as mere “strong letters”, without seriously having responded to the specific issues raised in a pragmatic, business-like and responsible manner ? How could such serious issues raised by Ambassador Peter Burleigh of grave concern to American business interests, spotlighted in the public interest have ever been dismissed as “a lot of hot air” ? Would that have been a responsible response in the world of business ? Was this not exactly what the Foreign Minister Lakshman Kadirgamar, in fact, really had stated, as was reported in the media ?

Not only was P.B. Jayasundera re-appointed Secretary, Ministry of Finance & Secretary to the Treasury, but also the Chairman, John Keells Holdings Ltd., Susantha Ratnayake was appointed Chairman, Sri Lanka Tea Board, and the Chairman Distilleries Company of Sri Lanka Ltd., and Aitken Spence Co. Ltd., D.H.S. Jayawardene was appointed Chairman, Ceylon Petroleum Corporation, by the Government of President Mahinda Rajapaksa. In addition, Susantha Ratnayake, Chairman, John Keells Holdings Ltd., an UN Global Compact Company has assumed Office, as Chairman of the Ceylon Chamber of Commerce, the premier Chamber of businesses in Sri Lanka !

It is indeed intriguingly baffling, as to why the US State Department Report, whilst quite righteously been critical of the re-instatement of P.B. Jayasundera, as Secretary to the Treasury, has turned a ‘blind eye’ to such grave act of the blatant appointment of Milinda Moragoda, as Minister of Justice, immediately after the Supreme Court Judgment, which severely castigated him; thereby derogating the judiciary ? Milinda Moragoda lost at the last General Elections in 2010. However, shortly thereafter, Milinda Moragoda was appointed, as one of the several Advisors to President Mahinda Rajapaksa.

Chief Justice Asoka de Silva, the new Chief Justice referred to in the US State Department Report, immediately upon retirement was appointed, as Legal Advisor to President Mahinda Rajapaksa, drawing criticisms from sections of the legal fraternity. Prior to assuming Office, as Chief Justice, Justice Asoka de Silva, had presided over the UN International Criminal Tribunal for Rwanda, and had convicted and sentenced former Rwanda Army Chief to 30 years imprisonment for his role in the 1994, and two former Army Generals to 20 years imprisonment, and former Military Chaplain to 25 years imprisonment, for genocide, including crimes against humanity and war crimes, defined as violations of Common Article Three and Additional Protocol II of the Geneva Convention.