Experts: the laws should explain the term “corruption” in more detail

A round table “Topical issues of criminal law. Corruption: phenomenon and system, legal ways of fighting it”, organized by the Law Firm "YUST", “Ugolovny Protsess (Criminal Proceedings)” magazine and RAPSI was held at the Press Center of RIA Novosti on February 22, 2012.

The following persons participated in the round table:

• Advocate Elena Lvova, Head of Practice of criminal proceedings of the Firm, Doctor at Law;
• Konstantin Katanyan, Russian journalist, member of the Union of Journalists of Russia, awarded “Golden Quill of Russia” (2003), editor-in-chief of the “Notarialny Vestnik” magazine and “Pravo Kazhdogo” and “Bukva Zakona” newspapers;
• Mikhail Evraev, Chief of FAS Section of control over the placement of government orders;
• Kirill Kabanov, Chairman of the National Anti-Corruption Committee;
• Andrey Radionov, Deputy Editor-in-Chief of Kommersant-FM.

The round table was moderated by Vitaly Ushkanov, General Director of RAPSI. In his opening speech, he expressed his hope that the forthcoming discussion at the round table would assist the lawmakers, since they had not yet decided on the essence of such terms as corruption, kickback, “saw cut” etc. And since there is no distinction between a corruption crime and corruption as a phenomenon of social life, those who may not be classified as corruptionists, but who are forced to bribe, for example, a road police officer, are in a bad situation.

Vitaliy Ushkanov noted: “At the same time, the problem is also of a legal nature: nowadays one may be punished under the Administrative Offences Code as well as under the Penal Code for a single corruption crime. And the Russian Federation has ratified the criminal law convention on corruption, according to which corruption is definitely classified as a criminal offence”.

Afterwards Vitaly Ushkanov gave the floor to Advocate Elena Lvova, Doctor at Law, who stressed that it was necessary to define the subject of every discussion: “Everyone speaks on corruption, but nobody knows, what corruption is. But still everyone knows that one should fight corruption, and how”.

She told the participants of the round table that while trying to find a legal definition, she had discovered that the basic Russian and foreign normative acts on corruption issues either contained no definition of corruption, or identified the term with bribery or a set of other corruption offences. Such an approach provokes many questions: if it just a bribe, why introduce the term “corruption”, when everyone knows what bribe is and how to fight it.

The list of corruption offences is also questionable: who started the list, on what principles, and if the list is currently complete. And at this moment the Advocate, “at her own risk and without watching any authorities”, presented for general discussion her own definition of corruption.

Corruption is a steady, systematic, group, complex criminal activity, which trespasses against the totality of different kinds of social relations in the sphere of state authority, economy, property, justice, governance and other kinds stipulated in the criminal legislation, with the use of power of authority and governance, and aimed at the extraction of gains.

Full version of the presentation is available here.

Following this definition, Elena Lvova, for example, explained the difference between a corruption bribe and a common bribe. First, the former is connected with extortion: the briber does not commit the offence willingly, but is rather put into conditions, when he cannot but give the bribe. Second, the corruption bribe is not paid by one’s own, earned money, but with the money “saw cut”, received as a result of corruption-related criminal actions.

Elena Lvova cited a good example of the celebrate Uzbekistan case of the mid-eighties of the XX century. “The superiors doctored the reports on the amounts of collected cotton; each foreman was given his own plan by the reception post. The cotton went to the cotton plant, where it was sorted by classifiers. The uncollected cotton had to be made up, so it was re-graded: ulyuk – low-quality cotton – was added to the high-grade cotton. Cotton wool plants were bribed to accept the cotton as high-grade, paid for it as if it were high-grade, and money were handed down the chain”. When the money got to the places, where such cotton was collected, it was “saw cut”. Classifiers and foremen bribed the directors of cotton plants with the “saw cut” money. The directors bribed the directors of region trusts. The region trust directors took the bribes and bribed the Board of the Ministry, which was in turn protected by the minister of cotton industry. The latter was executed for this, said the Advocate. That is why she is of the opinion that “saw cuts” are a form of the corruption trespassing upon the social relations in the sphere of property.

Elena Lvova also cited the example of the corruption scheme currently existing in the utilities sphere. State institutions of engineering services (GUIS) and Single Client Directorates (DEZ) provide the citizens with services on contracts. Payment for these services comes from the state budget or directly from the citizens. According to the agreement, the contractor organizations, which render the services directly, convert a part of these monies into cash and hand them to the heads of GUIS and DEZ. The heads of these institutions deliver the cash to the heads of municipal organizations and, possibly, further up. On these premises, concludes Elena Lvova, kickback is a criminal corruption activity in the property sphere, even though the persons’ actions are classified in practice as bribery. She said: “Why is it so? It is so, because the bribegiver is exempt from responsibility, and can be manipulated. Otherwise a half of Russia will have to be put behind bars, at least the contractor organizations – for sure”.

The well-known journalist Konstantin Katanyan agreed with Elena Lvova but with reservation: “When you say that a corruption bribe is not paid with one’s earned money, I believe that it narrows the term a bit: earned money may be present at a certain stage to a certain measure. It may be present, for example, when what is passed on from below is not enough to pass on up. And the person, not wishing to fall out of the corruption scheme, adds his hard-earned, hoping to win it back afterwards. The system keeps functioning and changing shape. And we keep marveling at the passage from the “saw cuts” of public money to the “saw cuts” of private money”.

The journalist called the participants’ attention to the fact that it would not cross the kickbacker’s mind to complain, for he wants to get the order. Konstantin Katanyan said in this connection that, as a journalist, he preferred two ways of fighting such schemes. The first one is the “purely civil” one – changing the situation when the society is loyal to this phenomenon – a person should stop thinking that “it is easier to bribe the road police officer right there or to pay the doctor to perform the surgery today and not in three months”. The second approach is enabling and stimulating the mass media to divulge all corruption crime cases, that is – uncovering the corruption schemes.

Konstantin Katanyan agreed with Elena Lvova that the reasons, why the Federal Law on combating corruption, in effect since December 2011, only listed several types of corruption crimes, were completely obscure. He remarked ironically: “I believe that this road is the wrong one: if a list is given, it should be exhaustive, but then the law will turn into a really fat tome”.

Mikhail Evraev, Chief of FAS Section of control over the placement of government orders, presented to the round table his own program of combating corruption. Mikhail Evraev told that the Penal Code did not contain enough provisions regulating the sphere of municipal government orders, so the FAS drafted four new constituent elements of offence and submitted them to the Prosecutor General’s Office. He said that his institution frequently faced the following situation: deliberate signing of contracts for huge amounts, holding tenders for one price and executing contracts for another. “The money is spent, we deliver the information to the law enforcement bodies, but no reaction follows, because they cannot prove the existence of guilt: had there been premeditation, the situation would be different. Many cases end up empty”. Mikhail Evraev said that the subjective criterion in the rules of holding government order tenders practically legalized corruption. He added: “There are no rules impeding this”.

Furthermore, criminal cases are often initiated without constituent elements of offence being present in the Penal Code (for example, if the starting price of a contract was not duly defined). Mikhail Evraev said: “Nobody knows, what is “duly”, for the law does not define this term. Anyone may be put behind bars this way, and this is not normal”.

He called the participants’ attention to the fact that frauds with bank guarantees and sureties were very common in the sphere of government municipal orders. The expert said: “This phenomenon is very widespread. 70-80% of sureties nowadays are faked, as are 20-30% of bank guarantees. And it is very difficult for the client to check the sureties and the banks”. He suggested creating a centralized register of sureties and bank guarantees. Mikhail Evraev believes: “If a company wishes to become a surety, it submits information on itself to the portal, is checked by the tax authority for 10 days, and is added to the register. We suggest the same procedure for the banks that wish to give guarantees. These measures are simple yet will completely solve the problem of false financial security”.

Mikhail Evraev proposed a state program of preventive measures, which would contribute to prevention of corruption actions by state officials and public companies’ employees. He is of the opinion that everything depends on the financial motivations. He believes that the public servants should be downsized, and their salaries sufficiently increased, because incompetent and underpaid people work in the public service. Mikhail Evraev said: “We witness public service bodies of low quality, because no fresh people come there to work. What is happening in our country is a result of this”. He cited the example of Singapore, where the bureaucracy had been downsized and salaries increased, which resulted in specialists coming to work as public servants and holding onto their jobs.

The expert believes that the legal procedure in the sphere of economy should be reformed and shortened, so that a trial would take up to one month and a half, not more: precisely such legal procedure is efficient. Mikhail Evraev said: “It is meaningless to talk about combating corruption with a court system like the one we have”. The same is true in the respect of government purchases – he says that people give bribes, because they do not want to spend a year and a half in the court, receiving afterwards a ruling, which no one any longer needs. Public control is needed in the spheres, where the state is present. The public official said: “We have created an all-Russian portal in the sphere of government orders, where all orders are visible – this is public control, not public councils under power authorities that don’t function”. He is of the opinion that the base has been created, and now it is being planned that all state-owned companies will place their information on this single all-Russian portal. Mikhail Evraev added: “Nobody knows, what is going on in large state-owned enterprises. The situation in government orders area is much more transparent than in state-owned companies”. He also believes that equal access must be allowed to the government orders as well as to all property benefits distributed by the state: land plots, lease titles, license rights, titles to natural resources and subsoil. The expert said: “This area is fully non-transparent nowadays. The entire system should be transferred to electronic auctions. This will provide for equal access to property titles distributed by the state”. Furthermore, the actions of public officials must be strictly regulated, and the business separated from the public sector. Mikhail Evraev is convinced: “Corruption is inherent, where the state participates in the business”.

According to Mikhail Evraev, only the government purchases generate losses for the country of approximately one billion roubles each year. It is impossible to calculate the total amount of the state’s corruption-related losses.

Kirill Kabanov, Chairman of the National Anti-Corruption Committee, in his turn, mentioned that, for example, obtaining immaterial benefit was also corruption. He added: “A civilized legal system establishes criminal responsibility for this”, and then noted that the lawmakers would hardly call for systematization. Kabanov said: “Two documents already exist: the national plan and the strategy of combating corruption. They contain all necessary measures, but there is still no result. Corruption is still seen as a way of comfortable life by most public officials”. Furthermore, he is of the opinion that the corruption has long become a business of a kind.

Andrey Larionov, Deputy Editor-in-Chief of Kommersant-FM, opined in his speech that the task of eradicating corruption was utopian. He concluded: “If a person has the intention, he cannot be stopped. In this issue, we should try to affect the consciousness of the citizens”.

The Advocate Eleva Lvova concluded the work of the round table summarizing: “Our notions and knowledge of corruption should be systematized in order to fight it by legal means. A corruption bribe is a bigger social evil than common crimes. Corruption threatens the totality of social relations. And the existing definitions are of no value to the practicing lawyers, who want to discover the very criminal corruption element in the actions of individual persons, which encompasses consistent elements of several offences”.

The expert believes that, speaking on the corruption and its indestructibility, while there is offer and demand, one must not forget that there is the third component – the victims. And the victim is the people. She recommended never forgetting this third component. And if corruption is truly a business, it is also true that corruption is also a form of exploitation of the people by the authorities for the sake of this business, concluded Elena Lvova.

The video record of the round table “Topical issues of criminal law. Corruption: phenomenon and system, legal ways of fighting it” held on 22.02.2012 granted by RIA Novosti.