draining development.pdf - Khazar University

404 Draining Development?this level of popular support and legitimacy, lavished huge cash sums, aswell as contracts on a wider range of potential threats and needed supporters.In environments where economic power is more concentratedand where investigative and criminal justice institutions may be seen tobe and may actually be less independent of government than in most(but not all) developed countries, how can police, anticorruption commissions,prosecutors, and judges be expected to deal properly withreports on elites? How can local FIUs in developing countries deal effectivelywith SARs that are reported to FIUs in developed countries andpassed on to authorities in the developing countries for intelligencedevelopment? Such action may not be necessary in the developing countriesif money laundering charges can be made in developed countriesagainst the foreign PEPs, but prosecutions are not always successful;those undertaken in English courts have been subject to serious delaysand difficulties exacerbated at the intersection between the human rightsof the defendants and transnational investigative powers.ConclusionThis chapter represents a difficult venture into an underdeveloped literatureon a policy area that has been caught up in a process of permanentexpansion over the past two decades. It is clear that the substantial financialproceeds arising from corruption are often retained or even importedinto developing countries to pay off political rivals, satisfy obligations tofamilies, friends, and clans, and invest in local businesses and property.The steps necessary so that local AML measures can be used to identifyand act against such activities remain somewhat uncertain. If suspicionsare communicated to national FIUs or, conceivably, by internationalbanks to foreign FIUs, what could these FIUs plausibly do with thereports if investigators and prosecutors are not truly independent? (Inthe latter case, it seems unlikely that the kleptocracy would have developedin the first place.) However, the combination of local and foreigninvestigations running in parallel might yield more than the sum of thetwo. The inward movement of cash or the corporate and charity vehiclescan be a way of bringing funds into, as well as out of, developing countries.Estimating the size of these internal-internal and external-internalflows has not been attempted here.