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New research from Transparency International Defence & Security warns of high corruption risk across CEE region

 

December 9 – Decades of progress towards greater democratisation across Central and Eastern Europe (CEE) threatens to be undone unless urgent steps are taken to safeguard against corruption, new research from Transparency International warns.

The Government Defence Integrity Index (GDI) finds more than half of the 15 countries assessed in the region face a high risk of corruption in their defence and security sectors.

Released today, Progress [Un]Made identifies region-wide issues which provide fertile ground for corruption and the deterioration of governance. These include weak parliamentary oversight of defence institutions, secretive procurement processes that hide spending from scrutiny, and concerted efforts to reduce transparency and access to information.

These issues are compounded by the huge amounts of money involved, with spiralling military expenditure in the CEE region topping US$104 billion in 2019 as many states continue to modernise their defence and security forces. The 15 states featured in the report are responsible for a quarter of this total with the majority increasing their defence budgets in the last decade.

 

Natalie Hogg, Director of Transparency International – Defence & Security, said:

Following major strides towards more robust defence governance in Central and Eastern Europe, many of these results should be a cause for concern. Corruption and weak governance in the defence and security sector is dangerous, divisive and wasteful. While it is encouraging to see a handful of countries score well the overall picture for the region is one of high corruption risk, especially around defence procurement – an area responsible for huge swathes of public spending.”

 

The GDI provides a detailed assessment of the corruption risks in national defence institutions by scoring each country out of 100 across five key risk areas: financial, operational, personnel, political, and procurement. Highlights from the CEE results include:

  • Average score for the region is 48/100, indicating a high risk of corruption.
  • Montenegro is judged to be at ‘very high’ risk with a score of 32, while Azerbaijan’s score of just 15 places it in the ‘critical’ risk category.
  • High levels of transparency see Latvia fare the best in the region, with a score of 67 indicating a low risk of corruption.
  • Authoritarian governments have weakened parliamentary oversight (Poland) and restricted access to information regimes (Hungary), closing off a key sector off from public debate and oversight.

 

 

We identify five key themes that are increasing corruption risk across the region, including:

Weak parliamentary oversight

Parliamentary oversight of defence is a key pillar in enforcing transparency and accountability but only two of the 15 countries we assessed have retained truly robust parliamentary oversight.

CEE regional average score: 51/100 (Moderate risk)

Best performers: 1) Latvia: 94/100 (Very low risk); 2) Lithuania: 83/100 (Very low risk)

Worst performers: 1) Azerbaijan 12/100 (Critical risk); 2) Hungary 27/100 (Very high risk)

 

Opaque procurement processes

Allowing companies to bid for defence contracts helps reduce the opportunities for corruption and ensure best value for taxpayers, but our analysis highlights that open competition in this area is still the exception rather than the norm.

CEE regional average score: 47/100 (High risk)

Best performers: 1) North Macedonia 82/100 (Low risk); 2) Estonia: 74/100 (Low risk)

Worst performers: 1) Azerbaijan 8/100 (Critical risk); 2) Hungary 14/100 (Critical risk)

 

Attacks on access to information regimes

Access to information is one of the basic principles of good governance, but national security exemptions and over-classification shield large parts of the defence sector from public view.

CEE regional average score: 55/100 (Moderate risk)

Best performers: 1) Georgia, Latvia, North Macedonia, Poland 88/100 (Very low risk); 2) Lithuania: 75/100 (low risk)

Worst performers: 1) Azerbaijan 13/100 (Critical risk); 2) Hungary 25/100 (Very high risk)

 

To make real progress and strengthen the governance of the defence sector in the region, Transparency International calls on governments across the region to:

  • Respect the independence of parliaments and audit institutions and provide them with the information and time they need to perform their crucial oversight role.
  • Overhaul their procurement systems to ensure more competition and transparency.
  • Guarantee transparent and effective access to information and implement a clear rationale on the use of the national security exception, as well as transparency over how the rationale is applied.

 

Notes to editors:

Progress [Un]Made – Defence Governance in Central and Eastern Europe can be downloaded here.

The CEE region spent US$104 billion on defence and security in 2019. This total includes Russia, which spent US$65 billion. Lithuania and Latvia increased military spending by 232 per cent and 176 per cent respectively between 2010 and 2019, and Poland by 51 per cent over the same period. Armenia and Azerbaijan consistently spend close to 4% of GDP on defence and are among the most militarised countries in the world.

Whilst defence governance standards in Europe are some of the most robust globally, states in Central and Eastern Europe and the Caucasus, where a combination rising defence budgets and challenges to democratic institutions, are particularly vulnerable to setbacks to their recent progress in governance and development.

In Armenia, Albania, Hungary, Kosovo, Montenegro, Poland and Serbia, there is a notable tendency for parliaments to align themselves with the executive on defence matters, for example by passing executive-sponsored legislation with no or only minor amendments.

In Georgia, secret procurement accounted for 51 per cent of total procurement procedures from 2015-2017. In Ukraine that figure is 45 per cent, while in Poland it is as high as 70 per cent. In Lithuania, open competition accounted for as little as 0.5 per cent of procurement procedures, with upwards of 93 per cent of defence procurement conducted through restricted tenders and negotiated procedures.

In Hungary, the government has made it harder to access information by skewing the rules in favour of public bodies and imposing new fees on those who lodge requests. In Estonia, the 2013 access to information act contained 7 exceptions, with 1 related to defence; by 2018, there were 26 exceptions, with 7 related to defence. Just three of the 15 states we assessed – Lithuania, Latvia and Georgia – were found to have been responding to freedom of requests promptly and mostly in full.

 

About Transparency International

Through chapters in more than 100 countries, Transparency International has been leading the fight against corruption for the last 27 years.

About the Government Defence Integrity Index

The GDI is the only global assessment of the governance of and corruption risks in defence sectors, based upon 212 indicators in five risk categories: political, financial, personnel, operations and procurement.

The Central and Eastern Europe wave includes assessments for 15 countries: Poland, Hungary, Lithuania, Latvia, Estonia, Ukraine, Armenia, Georgia, Azerbaijan, Serbia, Bosnia & Herzegovina, Kosovo, Albania, Montenegro and North Macedonia. All states are either EU/NATO members or accession/partner states.

The GDI was previously known as the Government Defence Anti-Corruption Index (GI). The Index underwent a major update for the 2020 version, including changes to the methodology and scoring underpinning the project. This means overall country scores from this 2020 version cannot be accurately compared with country scores from previous iterations of the Index.

Subsequent GDI results will be released in 2021, covering Latin America, G-20 countries, the Asia Pacific region, East and Southern Africa, and NATO+.

Contact:

Harvey Gavin

[email protected]

+44 (0)20 3096 7695

+44 (0)79 6456 0340 (out of hours)

 

 

Download as PDF: Statement on the killing of George Floyd, protests in the United States, and the need for transparency in related military deployments

 

June 10, 2020 – Transparency International – Defense & Security stands in solidarity with those demanding justice, equality, accountability and an end to racism worldwide following the killing of George Floyd while in the custody of police officers in Minneapolis on May 25.

In response to the resulting protests seen across the United States, the National Guard has been activated in 23 states throughout the country to assist local law enforcement agencies in the policing of protests, while some active duty military units were temporarily deployed to the National Capitol Region to potentially assist federal authorities.  On June 2, the president announced he was “dispatching thousands and thousands of heavily armed soldiers, military personnel, and law enforcement officers to stop the rioting, looting, vandalism, assaults, and the wanton destruction of property”. According to news reports, 17,000 National Guard members had been deployed, approximately the same number as active-duty US troops currently serving in Syria, Iraq and Afghanistan.  This is in addition to 45,000 members of the National Guard who have already been deployed across all 50 states in response to the COVID-19 crisis.

The challenges and responsibilities faced by the armed forces in complex times are significant as they seek to protect their fellow citizens as well as prevent the violence and property damage that have occurred in some metropolitan areas.  The statements by a number of current and former military leaders reminding servicemembers of the importance of American values and their oath to support and defend the Constitution and the citizens whom they serve send an important message.

It is during times such as these that transparency and oversight matter most to ensure that actions undertaken are accountable to the public. Some of these deployments present challenges in terms of protecting the right to peaceful protests alongside the duty to protect lives and livelihoods.

After days of scrutiny over the militarization of the police response, including the use of National Guard personnel to forcibly clear Lafayette Square of peaceful protestors on June 1,  Secretary of Defense Mark Esper and Chairman of the Joint Chiefs of Staff General Mark Milley appear to have refused a request to testify to the House Armed Services Committee. This response shows a disregard to the key guiding principles of transparency, oversight and accountability, as enshrined in the constitutional system of checks and balances.

Transparency International – Defense & Security calls on all governments around the world to instil greater transparency in all aspects of civil-military relations and to ensure responsible use of military by political leaders. To the government of the United States, we make the following recommendations based on established best practice in the defense and security sectors:

 

  • Ensure that all law enforcement agencies responding to protests, including components of the military when performing law enforcement duties, receive additional training and facilitate the right of peaceful public assembly.

 

  • Commit to the principles of transparency and accountability and ensure that Secretary of Defense Mark Esper and Chairman of the Joint Chiefs of Staff General Mark Milley fulfil all oversight requirements.

 

  • Resist any inclination by those who lead the security sector to limit engagement with citizens in response to this crisis. Trust can only be enhanced through more interaction, not less.

 

Transparency International – Defense & Security strongly encourages greater transparency and accountability in all aspects of relations between the military and civil society. The use of security forces must not infringe on the public’s First Amendment rights of peaceful assembly and freedom of speech.  Respect for and protection of basic human rights is the only path to restoring much-needed trust in civil-military relations.

 

Contact:

Harvey Gavin

[email protected]

+44 (0)20 3096 7695

+44 (0)79 6456 0340

Ara Marcen Naval is Head of Advocacy for Transparency International – Defence & Security. In this blog, she explains her motivations for joining the fight against corruption – and why our work in the defence sector matters more than ever.

 

In November 2019, I joined Transparency International’s Defence & Security Program after years working for other high-profile organisations on arms control and human rights.  Transparency International is best-known for its indices, especially the flagship Corruption Perception Index. But what most intrigued me were the less well known – but equally important – indices which measure the risk of corruption of the defence sector.

In my career, I have witnessed some of the biggest developments in the arms control regime, including the adoption of the Arms Trade Treaty. However, despite civil society efforts to curb the arms trade, global defence spending keeps rising – by 15 per cent in the past decade. Major players like US, EU, China and Russia have embarked on major programmes to modernise and upgrade their militaries, increasing military spending over the decade to 2016 by 144 per cent and 106 per cent respectively. And many other states are following suit. In Asia, at least five countries have doubled their defence expenditure in the same period; in the Middle East, defence comprises an average 15 per cent of state spending.[1] The opportunity of trade deals hollows the considerations for development and human rights.

But it is not just the size of defence budgets that matters. Global military expenditure is rising, yet rising most rapidly in exactly those places where standards of governance are weakest. And where checks and balances are weak, vast proportions of public funding are spent in completely opaque ways.  Parliamentary committees, judiciaries, and audit offices are growing in authority in many countries from Malaysia, to South Africa, to Brazil. But defence matters all too often remain off-limits.

Despite this, the arms control regime (for instance, in the Arms Trade Treaty, or the EU Common position) does not observe corruption as one of the criteria to refuse the license to transfer weapons. Procurement and arms trade deals take place over time, sometimes there are deals that take 10 years or more, and currently there are no obligations for states to extant licences that can be suspended or revoked on the basis of new information or changed circumstances.

The arms industry is generally held to be among the most vulnerable to corrupt behaviour across all industrial and commercial sectors. Cases of large-scale corruption continue to be reported and recorded, and the problem is remarkably persistent despite repeated efforts to insert policies on anti-bribery and corruption. The excessive influence of the industry in government decisions has potentially dangerous consequences. It risks eroding the government’s ability to make independently informed choices on military needs, which might increasingly have to rely on data and expertise of existing suppliers with own vested interests when designing tenders, determining the merits of products and their suitability to close capability gaps.

The anti-corruption movement has a huge peak to climb. Defence & security sectors are excluded from most of the existing mechanisms to fight corruption as it lays in the national security arena. All states struggle with the need to find a balance between national security concerns and the freedom of information. The risks of failing to control sensitive information related to national security can be extremely serious, and it is understood that a higher level of secrecy is needed in areas of the defence and security sector to protect national security. However, this should not justify non-compliance with international best practices in secrecy classification.

Where there is no expectation that defence institutions are transparent about their activities, a multitude of opportunities for corruption present themselves. Weak legislation, a lack of accountability and poor or inexistent oversight systems provide the perfect environment for individuals to engage in corruption. We need to raise our voices to demand closer oversight: defence can’t continue being the exemption. It needs to be part of the anti-corruption efforts, both for civil society and for governments and institution.

 

[1] SIPRI, Military Expenditure Database 2017, https://www.sipri.org/databases/milex.

In 2016, Transparency International – Ukraine and Transparency International – Defence & Security created the Independent Defence Anti-Corruption Committee (NAKO). A year ago, NAKO became an independent NGO.

As NAKO moves through the transition toward effective governance and full operational autonomy, we  wish to thank all those who have contributed to its and our work so far. In particular, our thanks go to the NAKO Committee members: Drago Kos, Yulia Marushevska, Volodymyr Ogrysko, Oleh Rybachuk, James Wasserstrom and Michel Yakovleff, as well as previous Committee members – Timothy Evans and Sevgil Musaeva.

Director of Transparency International Defence and Security, Steve Francis, said:

“We thank the committee members for their insight and commitment. They have been key to the progress NAKO has made since it was set up three years ago in working towards building integrity, transparency and accountability in the defence sector in Ukraine.”

We look forward to continue working with NAKO as a strategic partner in Ukraine, and to support its efforts to combat corruption in the Ukrainian defence sector, thereby increasing the effectiveness of defence spending, improving living conditions of defence personnel and ensuring Ukraine’s defence forces provide state and human security.

7th March 2019, London – A resolution, passed in the Dutch Parliament, calling on the Dutch Government to support the inclusion of anti-corruption measures as a separate criterion in EU arms exports, is an important move that we hope will see further action, according to Transparency International Defence and Security Programme and Transparency International Netherlands.

On Tuesday, Dutch MPs voted to support a resolution that called for the strengthening of EU arms export criteria and noting that corruption occurs in major arms deals, contrary to both the law and the principle of fair competition.

The current EU Common Position on arms exports control, which dates from 2008, makes no reference to corruption in its 8 criteria, despite the very high risk of corruption in this sector. Introducing a corruption criterion would open the possibility of an export licence for military technology or equipment being denied where there is a clear risk that the deal might involve a significant level of corrupt practices. 

Steve Francis, Director of Transparency International Defence and Security said:

“We welcome this step by the Dutch Parliament as it calls the Government to take a leading role within the EU to carve out a new and explicit anti-corruption criterion in the EU’s arms export regime. We now hope the Dutch Government will use its influence in the European Council to push for the inclusion of this criterion as part of the Common Position review.”

“Big steps and strong leadership from member states is vital in tackling the risks posed to citizens, as well as the unfair playing field created by defence companies that engage in corrupt activity. We therefore hope other member states will adopt similar approaches to ensure anti-corruption provisions are properly considered ahead of arms deals.” 

***ENDS***

Contact:
Dominic Kavakeb
+44 20 3096 7695
+44 79 6456 0340
[email protected]

Relevant Links

Less than a month into his new role as Director of our Defence and Security Programme, we sit down with Steve and find out why he joined the fight against corruption and what he’s most looking forward to.

What inspired you to join Transparency International?

I had been aware of TI’s work, especially the Government Defence Index for some time having used the index while studying at Pakistan’s National Defence University. TI’s Corruption Perceptions Index was also in use at the British High Commission in Islamabad during my time there in 2013-15.  But while I was aware of the Movement, I hadn’t necessarily considered it as possible second career option while I was still serving in the military. What I was more certain of however, was that when I did retire from military service, I wanted to find a role in the INGO sector that would allow me to continue to be involved in international development. That said, I was also acutely conscious that although I had worked with and alongside good people from the sector before, moving into it ‘from the outside’ as it were, would be a huge challenge, as anyone that has ‘jumped sector’ would attest to. So when I discovered that TI were recruiting a new Director of the Defence & Security Programme I leapt at the opportunity. It encapsulated everything I was looking for. It would allow me to transition from the military to the INGO sector, yet was a role that would allow me to leverage the experience I had gained over a 30-year career in the Royal Marines. The learning curve would of course still be very steep, but it would be scalable; and I sensed that I could quickly add value, while those other – more sector specific skills – caught up.                    

How has your career in the military shaped your view of corruption?

For most of my career, my understanding of corruption was probably rather rudimentary. When I had come across it, for example as a junior officer working with foreign militaries, it was seen through the lens of low-level criminality. It was generally viewed as something endemic to a culture or a country that had to be accepted as ‘just the way things are’.  Sure, we needed to recognise it; be aware of its pitfalls and work around it, but it wasn’t something that we could tackle. Indeed, it wasn’t even our job to do so, that sort of thing was seen as being for law enforcement agencies to take on, not the military. It wasn’t until I was involved in the Afghan Campaign as planning officer later in my career that I started to realise that one of the reasons why the ISAF coalition could never seem to persuade ordinary Afghans to side with the international community instead of the Taliban, was because although we were offering security, we were doing so without also offering justice. To me, the problem we were facing in Afghanistan seemed to be as much about Justice Sector Reform as it was Defence Sector Reform, yet the international community either failed see it as a priority, or simply equated justice reform with police reform. The flaw in my analysis then, was that while I had recognised a symptom, I hadn’t diagnosed its underlying cause namely the affront that is corruption.  The only consolation is that I wasn’t just me that had failed to recognise the real nature of the insurgency in Afghanistan, most if not all of us had, particularly in the formative stages of the conflict.       

What do you think are the key challenges for tackling corruption in the defence and security sector going forwards?

That’s a difficult one to answer in my first month in TI and when I’m still in the foothills of that learning curve I described. It’s not just the size, complexity and scope of the sector that is a challenge, but also what I’ve heard described as ‘defence exceptionalism’. In essence that (rather convenient) sense within the sector, that defence is inherently different; that by its very nature it has to be shrouded behind a veil of secrecy.  Some parts of it undoubtedly do, but in my experience such areas are actually the exception rather than the rule and the more self-aware, confident and professional a defence institution is, the more it understands that rather than a threat, transparency is actually a strength and a safe guard. Beyond that, a much bigger concern are those forces that together are increasingly challenging liberal democracy and the rules based international order. The headwinds of populism and authoritarianism are stiffening, which will make the job of anyone engaged in ‘speaking truth to power’ both harder and in some cases, more dangerous. Conversely of course, it also makes the job of TI-DS – and many others in civil society – even more important.                 

What are you looking forward to most about the role?

To be able to build an even better and more impactful team around me that can take on the fight against corruption in this most challenging of sectors. We already have a diverse range of fantastically talented and committed people in the Programme and I know there are more out there that both want and deserve to join us in this important endeavour – whether that be here in London, in a sister TI Chapter or working as individuals in support of our projects. I also want to build on the inspired legacy of my predecessor who did so much of the heavy lifting required to chart our current course.      

What can we expect for your team in the coming months?

I hope our scheduled programme of work will speak for itself. What won’t be seen by those outside the team, is all the work we are about to embark on that’s designed to improve our internal management processes. It isn’t glamourous and it isn’t why we joined TI, but it is essential. And if we can get it right – and we will – the pay-off should actually be a reduction in the time spent administrating ourselves and correspondingly more time to think about how we deliver lasting impact – and that’s the fun part of the job.      

16th January 2019, London – Transparency International is delighted to announce, from the start of January, Steve Francis as the new Director of its global programme on Defence & Security. His last assignment in the Royal Marines was in the British High Commission in Islamabad where he served as the UK’s Naval and Air Adviser; at Transparency International he will lead the Movement’s global work aimed at tackling corruption in the defence and security sector.

Steve joined the Royal Marines in 1988. Over the course of a 30-year career he served in a number of different roles, including heading up the Royal Navy’s International Engagement Team and working as the principal aide to the Coalition Deputy Commander in Afghanistan.

Transparency International’s global programme on defence and security is based within Transparency International UK (TI-UK) in London. As Director, Steve joins the Senior Management Team of TI-UK helping to shape the organisation’s strategy as well as leading a team of 20 full-time members of staff based in London and other locations around the world.

Steve Francis, Director of Transparency International Defence and Security Programme, said:

“I’m extremely proud to be taking on a global leadership role in such a well-respected organisation. Having served in a number of conflict ridden and fragile states during my former military career, I have witnessed first-hand how corruption can erode State institutions, undermine public trust, create insecurity and perpetuate conflict and its associated evils like poverty and injustice. I am hugely honoured to be given the opportunity to be part of the fight back against that corruption and its practices around the globe.”

Robert Barrington, Executive Director of Transparency International UK, said:

“I am delighted to welcome Steve to lead TI’s global defence and security work. He brings with him a wealth of experience and knowledge from the armed forces, notably in areas of the world where the problem of corruption is particularly acute. TI has selected the theme of defence & security as a key area of focus as it is notorious for corruption, shrouded in secrecy and has a tangible impact on the lives of ordinary people. Steve joins a dynamic team with a number of major achievements already under its belt and is currently working on some very innovative projects which will build on the success of Steve’s predecessors.”

***ENDS***

Contact:

Dominic Kavakeb
020 3096 7695
079 6456 0340
[email protected]

19th June 2018, Kiev – The Independent Defence Anti-Corruption Committee (NAKO) announced on June 19th that it is in favour of the revised tender for an independent audit and strategic analysis of Ukroboronprom. It has reestablished dialogue with Ukroboronprom and intends to monitor the tendering process.

NAKO said that the process is the opportunity to bring light to inefficiencies, corruption risks and structural deficits at Ukroboronprom and will be a first step towards resolving these issues and building a state-owned defence establishment that meets the needs of the public and armed forces. The NAKO committee stated that the creation of the independent Supervisory Board, which was appointed by President Petro Poroshenko this January, was a key step towards having effective governance and will be the main customer in the upcoming tender.

Volodymyr Ohryzko, NAKO Co-Chair, stated:

The Supervisory Board of Ukroboronprom is responsible for reforming the institution so that it meets the interests of the public and the Ukrainian state. This audit, in line with international standards, will aid the Supervisory Board in carrying out their responsibility and raising the company to meet international standards of governance.

The call for tender includes three parts: 1) an assessment of the corporate governance of Ukroboronprom and its members, 2) a legal review, diagnosis and consultation of Ukroboronprom and its member companies, 3) an independent financial audit of Ukroboronprom and its member companies.

The original tender did not include some of these components, including the independent financial audit. The NAKO provided recommendations to Ukroboronprom’s Supervisory Board about what should be included in the tender, and the Supervisory Board revised it in line with these recommendations. Following those amendments, the tender process is currently underway. The deadline has been extended from June 18th to September 28th in order to give a broader range of companies the opportunity to bid.

Drago Kos, NAKO Co-Chair said:

We hope to see a strong pool of auditing firms bidding for this. It is undoubtedly complex – but if it can be reformed, the impact on Ukraine and its future will be historic.

Olena Tregub, NAKO Secretary General confirmed that:

The NAKO continues to monitor this tender; our aim is to ensure that the reform of Ukroboronprom is provided with clear advice on the corporate structure and management, and that a full financial audit will identify financial black holes in the company – and will facilitate an evidence-based reform programme.

More details on the tender can be found here.

***ENDS***

Notes:

The Independent Defence AntiCorruption Committee (NAKO) is a joint initiative to fight corruption in the Ukrainian defence sector run by Transparency International Defence and Security Program Great Britain (TI-DSP) and Transparency International Україна (ТІ Ukraine).

The Committee consists of six members: Editor in Chief of online mediaUkrayinska PravdaSevgil MusaievaBorovyk, Former Minister of Foreign Affairs of Ukraine, Former First Deputy Secretary Defence and Security Council of Ukraine Volodymyr Ogryzko, Chairman of Centre UA, coinitiator of Chesno Campaign Oleh Rybachuk, LieutenantGeneral of the British Army and Former Commander of the NATO Allied Rapid Reaction Corps Timothy Evans, Former AntiCorruption Commissioner in Slovenia Drago Kos and Former Head of Oversight of Public Utilities at the UN Mission in Kosovo James Wasserstrom.

The goal for the NAKO is to reduce corruption risks in defence and security sector of Ukraine by means of monitoring, evaluation and analysis of anti-corruption reforms and providing the corresponding recommendations.

Contact:

Dominic Kavakeb
+44 20 3096 7695
+44 79 6456 0340
[email protected]

 

11th June 2018, London – Today, NGOs in France, Indonesia, Sri Lanka, Tunisia, the UK and the US are calling upon the agencies investigating Airbus to ensure that the company and its senior executives are properly held to account.

Airbus is under investigation in several jurisdictions for allegedly paying bribes in order to win billions of dollars of contracts. The allegations are egregious and widespread, covering multiple countries and involving several divisions within Airbus including commercial aircraft, helicopters and aerospace and defence.

In February 2018, Airbus reached a €81.25million settlement in Germany to end a corruption investigation into the 2003 Eurofighter deal with Austria. Over the coming months, prosecutors will be weighing up their options, with more settlements as one possible outcome, allowing the company to continue winning government contracts without prosecution.

Today the NGOs in a letter to the heads of the Serious Fraud Office, Parque National Financier and Department of Justice urged the authorities to ensure that:

  • National economic interest, relations with foreign states or the importance of Airbus as a national industry must not affect the investigation or prosecution of alleged bribery by the company;
  • Individuals responsible for the wrongdoing must face prosecution including those at senior levels;
  • No immunity deals should be included in any action taken against Airbus;
  • A settlement should only be given if prosecutors have high confidence that Airbus has fully cooperated and revealed the full extent of wrongdoing, and if it has fully signed up to genuine corporate change including through disciplining of employees responsible for wrongdoing;
  • Countries where it is proven that Airbus has paid bribes must be fully compensated for harm caused; and
  • Any enforcement action must be fully transparent with details of the wrongdoing made publicly available.

Susan Hawley, Director of Policy at Corruption Watch, said:

The Airbus case is a test of the resolve and independence of the prosecuting bodies and their ability to bring widespread and egregious wrongdoing to justice. Airbus and individuals implicated must not be let off lightly if these global allegations are confirmed by law enforcement investigations.”

Andrew Watson, Head of Industry Integrity at Transparency International Defence and Security said:

“If proven, these extensive cases of corruption will have had a significant impact on the public, state institutions and the industry. With such wide-ranging and complex allegations, it will be will be vital for prosecutors to co-ordinate closely if they are to account for the full scale of alleged offending; because individual cases, serious as they may be, won’t tell the whole story.”

“For the punishment to be proportionate to the crime, prosecutors should consider the full range of offending across all jurisdictions when reaching their decisions.” (more…)

22nd September 2017, London – Aleksandar Vulin, Serbia’s Defence Minister, should respond to legitimate questions over his purchase of a 205,000 euro property with transparency.

In December 2015 Serbia’s Anti-Corruption Agency sent a report to the prosecutor’s office after Vulin bought a 205,000 Euro property that did not appear to match with his declared income.  Since then, media reports have suggested that the Serbian police have refused to investigate the matter, despite the involvement of the Anti-Corruption Agency.

So far, Vulin has failed to provide any substantive response to the allegation, but has instead made disparaging comments about journalists reporting on this case.

Katherine Dixon, Director Transparency International Defence & Security, said:

 “Denigrating journalists who are working to expose corruption is not the answer to awkward questions. The only acceptable response by a senior government figure to questions of this nature is transparency.”

“It is vital for the maintenance of public trust in both the government and its institutions that Defence Minister Vulin now responds constructively to legitimate issues raised by the country’s Anti-Corruption Agency.  Integrity in the defence sector is vital for national security and the Defence Minister should be setting a strong tone from the top, by acting with transparency and supporting the role of the anti-corruption agency.”

***ENDS***

Contact:
Dominic Kavakeb
[email protected]
0044 20 3096 7695
0044 796 456 0340

4th August 2017. The Ukrainian MoD’s Medical Department invited NGOs and volunteer organizations to help develop new technical requirements for individual first-aid kits used at the frontline of military operations. Experts from the Independent Anti-Corruption Committee on Defense (NAKO), a joint initiative of TI Ukraine and TI Defence & Security, took part in their development, providing input on how to reduce corruption risk. The MOD granted final approval for the technical requirements last week, and Ukrainian servicemen should receive their new first-aid kits this autumn.

The need to develop new technical requirements arose as military and volunteers repeatedly complained about the poor quality of individual first-aid kits (IFAKs) used at the front. Previous IFAK components had been approved in February 2015. However, the list of components for the first-aid kit was less comprehensive, and the standards lower, than those used in NATO countries. In addition, the IFAK technical requirements were often developed by the IFAK manufacturers themselves, meaning that they could shape the MOD’s procurement requirements to suit what they could provide. The new specifications allow the MoD to require manufacturers to ensure each component of the kit is of the highest standard of quality.

The MoD began work on creating new technical requirements for IFAKs in September 2016. Initially, the key stakeholders in the process were representatives of the Ministry of Defense and Ukrainian manufacturing companies, but this approach created significant corruption risks.

But in April 2017, the MOD changed its approach, creating a separate working group in order to minimise the influence of pharmaceutical companies and to avoid corruption risks. This new working group created by the Ministry of Defence included leading medical experts, NGO representatives and volunteer organisations, as well as NAKO experts. This group of experts have worked together alongside the MOD to improve the technical requirements of the first-aid kits to match the NATO standards.

We insisted on minimising corruption risks. Previously, there was a risk that the specifications would match the preferences of a particular manufacturer, rather than respond to real frontline needs,” said Taras Yemchura, a NAKO researcher. “This could also lead to discrimination against particular participants in the procurement process. For example, we pushed for the abolition of unlawful requirements for special markings on the product packaging, which does not actually affect the quality of the goods, but significantly reduces the range of potential suppliers.”

In the future, NAKO intends to continue monitoring the process of IFAK purchasing, scrutinising the formation of lots, bidding, contracting, and quality control.

The committee is convinced that the active participation of independent experts and high-quality public monitoring of each procurement stage will help counteract corruption risks in the procurement of first-aid kits, decrease the risk of poor-quality goods being supplied, and will help save the lives of soldiers who fight in the Donbass.

**ENDS**

Media contact:

Sevgil Musaeva

+38-050-217-1817

[email protected]

The Independent Defense AntiCorruption Committee (NAKO) is a joint initiative established by Ukrainian public activists, journalists and international experts to fight corruption in Ukraine’s security and defense sector. NAKO is a joint international project of Transparency International Defense & Security and Transparency International Ukraine, supported by the Ministry of Foreign Affairs of the Netherlands.

Joint national-international committee sets sights on increasing transparency and accountability in country’s most vital sector

25 October 2016, Kyiv – The Independent Defence Anti-Corruption Committee (Nezalezhny Antikorrupciynii Komitet z pytan oborony, or “NAKO”) held its inaugural meeting in Kyiv last week, setting forth its intention to fight corruption in the Ukrainian defence sector. The Committee comprises six members, three national – Sevgil Musaeva, Volodymyr Ogryzko, Oleh Rybachuk (co-chair) – and three international experts – Lt Gen Tim Evans, Drago Kos (co-chair), and James Wasserstrom.

“Corruption in the Ukrainian defence sector is costing lives,” said Oleh Rybachuk. “Our soldiers and citizens deserve an MOD that is efficient, accountable, and serves their interests – our aim is to help our MOD achieve those aims.”

The Committee will develop a strategy 2017-2018. Its mandate, agreed on Thursday 20th of October, includes analysing and evaluating anti-corruption efforts in the defence sector, the development of recommendations, reporting to Ukrainian authorities and the public, promoting transparency, and strengthening accountability structures. It will also, later this year, enable citizens and soldiers to anonymously report corruption concerns to the group.

As a first step, the NAKO will produce a report on lessons learned from other monitoring groups, including the Monitoring & Evaluation Committee in Afghanistan. It will also analyse corruption risks and mechanisms for monitoring security assistance and military aid. Drawing on the findings from the 2015 Government Defence Anti-Corruption Index, produced by TI Defence & Security, it will submit recommendations for inclusion in the Annual National Programme 2017.

“In Afghanistan and Iraq, I saw first-hand the impact that corruption can have on the success of military operations. Without integrity, an Army can’t function effectively – and our aim, in the long-term, is to help the Ukrainian defence forces protect its people and its country,” said Lt Gen Timothy Evans, former commander of the NATO Allied Rapid Reaction Corps.

The idea for a dedicated monitoring body is based on learning from previous efforts in Afghanistan, Guatemala and Palestine. The committee was selected by a joint board of TI Ukraine and TI Defence & Security, following a public call for nominations earlier this year.

The NAKO is a project of TI Defence & Security, based in London, and TI Ukraine, and is supported by the Ministry of Foreign Affairs of the Netherlands.

***ENDS***

Contact:
Ukrainian – Sevgil Musaeva, [email protected], +380 502171817
English – Leah Wawro, [email protected], +44 789 4219638

Notes to editors

Biographies of NAKO members:

Lieutenant General Timothy Evans CB CBE DSO: A 3 star General in the British Army and former Commander of the NATO Allied Rapid Reaction Corps.

Drago Kos (co-chair): Former Anti-Corruption Commissioner in Slovenia, Former Chair of GRECO, and current Chair of the OECD Working Group on Bribery. “I’ve been coming to Ukraine for 15 years and for the first time I feel the country is ready for real change – and it’s time to include the defence sector too.”

Sevgil Musaeva: Editor in Chief of Ukrainska Pravda and author of investigative reports for Reuters, Forbes Ukraine, and the Organised Crime and Corruption Reporting Project. “I understood the problems of a weak defence sector when Crimea, my region, was annexed. So for me, it’s personal—I want to make the our armed forces more transparent and effective.”

Oleh Rybachuk (co-chair): Chairman of Centre UA, co-initiator of Chesno Campaign, and former Vice Prime Minister for European Integration and Chief of Staff to the president.

Volodymyr Ogryzko: Former Minister of Foreign Affairs, First Deputy Secretary Defence and Security Council of Ukraine. “We badly need international support to fight corruption in Ukraine.”

James Wasserstrom: Former Head of Oversight of Public Utilities at the UN Mission in Kosovo, Senior Advisor on Anti-Corruption at the US Embassy Kabul, and strategy advisor and lead anti-corruption at the Special Inspector General for Afghanistan Reconstruction. “Countries in conflict are always immense opportunities for nefarious activities, especially corruption, profiteering, and egregious mismanagement. I look forward to this body tackling all of the above.”

image: flickr.com/Sasha Maksymenko cropped by TI-DSP