The Corruption Tango
July 12th, 2010
July 12th, 2010
“No nation with which I am familiar has descended so deeply into this suffocating abyss [of corruption] as Nigeria.” -Raymond Baker
Africa’s most populous nation, recently welcomed home Nuhu Ribadu, its respected former corruption czar, after an 18 month exile in Britain. Ribadu ran Nigeria’s Economic and Financial Crimes Commission (EFCC) from 2003 to 2007 before deciding to leave the country, fearing for his life. He uncovered vast corruption, initiating over a thousand cases and winning an impressive share of convictions. In one case, he investigated the inspector general of the police service, seizing $150 million in assets and securing a six-month prison sentence for his former boss. In another, a governor was found to have siphoned three quarters of the state’s revenue into his own pockets.
Such examples illustrate the general perception of the level of corruption in Nigeria – the big men in government stealing much of the nation’s wealth. When asked which sectors they considered most affected by corruption, 63% of Nigerians answered political parties. Only 5% of respondents answered the business or private sector.
“Most of the cases of corruption in Nigeria are linked to the operations of multinationals in the country.” –Senior Official, EFCC
There exists a severe disconnect, or misunderstanding, between the general Nigerian perception and understanding of such corruption and how it is actually taking place. In a 2009 interview, Ribadu pointed out that when it came to curbing the largest payoffs, involving major multinationals, with bribes going to the top members of leadership in the country, he often felt powerless. “Most of this is happening outside of Nigeria. The documents are not in Nigeria. The money is not in Nigeria. The entire transactions take place outside.”
As the adage goes, it takes two to tango and multinational corporations often go along with the dance. Last week, Snamprogetti, a Dutch engineering firm joined American KBR and French Technip in settling with the SEC a two-year long case involving hundreds of millions of dollars in kickbacks to Nigerian officials in a $6 billion construction project. The three companies have agreed to pay close to $1 billion in settlements with the US government. “Companies generally want to settle rather than have all of their corrupt practices exposed” pointed out a capital markets lawyer following the case.
After his hero’s welcome, Ribadu and Nigeria will have a lot of work cut out for them if they want to effectively curtail corruption in Nigeria. Much like our profit-driven multinationals are willing to dance with shady Nigerian politicians to cut deals, our governments must extend a hand to those fighting the sleaze.