Financial Transparency Coalition

A 2005 documentary called Enron: The Smartest Guys in the Room details Enron’s involvement in the California electricity scandal, the company’s collapse in 2001, and the criminal trials of the companies’ top executives. The movie also spends time exposing the personalities of Ken Lay, Jeffery Skilling, and the other Enron executives largely responsible for the scandals, and as the title suggests, the movie also delves into their egos. But the truth is—and as much as we hate to admit it—they are smart guys. Maybe even some of the smartest. The problem with being smart is that it tends...

On Sunday U.S. Attorney General Eric Holder announced the Kleptocracy Asset Recovery Initiative at the African Union Summit in Uganda. The new policy aims to take on public bribes by recovering public money and returning it to its intended use. While the Obama administration has, so far, shown a greater propensity to tackle the thorny problem of foreign bribery than his recent predecessors, the new policy does not exist in a historical vacuum. In fact, the U.S. has had one of the world’s longest and strongest histories of action against foreign bribery. This is...

This Tuesday hundreds of U.S. businesses announced a campaign against tax evasion. Let me say that again, in case it didn’t fully sink in. Businesses are against tax evasion. Geez. Just when I got used to hearing that cracking down on tax havens will be bad for U.S. businesses. According to that argument it’s the politicians that “hate” tax havens because the jurisdictions “offer an escape hatch for oppressed taxpayers.” Tax havens are a blessing because individuals and businesses can use...

In the last issue of the Review of Development Economics, there was an article “Capital Flight: China’s Experience,” written by two professors of Economics, Yin-Wong Cheung and XingWang Qian. In this article Cheung and Qian use statistical analysis to explain what variables explain changes in capital flight from China. While there is no one definition, “capital flight” is generally synonymous with the term “illicit financial flow,” which describes the cross-boarder movement of illicit funds out of developing countries. In some contexts, however, capital flight can include licit forms of capital as well. There is also a difference...