Meet global corruption's hidden players
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0:00 - 0:03When we talk about corruption,
-
0:03 - 0:06there are typical types
of individuals that spring to mind. -
0:06 - 0:09There's the former Soviet megalomaniacs.
-
0:09 - 0:12Saparmurat Niyazov, he was one of them.
-
0:12 - 0:14Until his death in 2006,
-
0:14 - 0:17he was the all-powerful
leader of Turkmenistan, -
0:17 - 0:21a Central Asian country
rich in natural gas. -
0:21 - 0:25Now, he really loved to issue
presidential decrees. -
0:25 - 0:27And one renamed the months of the year
-
0:27 - 0:30including after himself and his mother.
-
0:30 - 0:32He spent millions of dollars
-
0:32 - 0:35creating a bizarre personality cult,
-
0:35 - 0:37and his crowning glory was the building
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0:37 - 0:41of a 40-foot-high gold-plated
statue of himself -
0:41 - 0:44which stood proudly
in the capital's central square -
0:44 - 0:47and rotated to follow the sun.
-
0:47 - 0:50He was a slightly unusual guy.
-
0:50 - 0:52And then there's that cliché,
-
0:52 - 0:55the African dictator
or minister or official. -
0:55 - 0:58There's Teodorín Obiang.
-
0:58 - 1:03So his daddy is president
for life of Equatorial Guinea, -
1:03 - 1:06a West African nation that has exported
-
1:06 - 1:09billions of dollars of oil since the 1990s
-
1:09 - 1:13and yet has a truly appalling
human rights record. -
1:13 - 1:15The vast majority of its people
-
1:15 - 1:18are living in really miserable poverty
-
1:18 - 1:20despite an income
per capita that's on a par -
1:20 - 1:23with that of Portugal.
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1:23 - 1:25So Obiang junior, well, he buys himself
-
1:25 - 1:30a $30 million mansion
in Malibu, California. -
1:30 - 1:31I've been up to its front gates.
-
1:31 - 1:34I can tell you it's a magnificent spread.
-
1:34 - 1:38He bought an €18 million art collection
-
1:38 - 1:42that used to belong to fashion
designer Yves Saint Laurent, -
1:42 - 1:43a stack of fabulous sports cars,
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1:43 - 1:46some costing a million dollars apiece --
-
1:46 - 1:48oh, and a Gulfstream jet, too.
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1:48 - 1:50Now get this:
-
1:50 - 1:54Until recently, he was earning
an official monthly salary -
1:54 - 1:58of less than 7,000 dollars.
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1:58 - 2:00And there's Dan Etete.
-
2:00 - 2:03Well, he was the former
oil minister of Nigeria -
2:03 - 2:05under President Abacha,
-
2:05 - 2:08and it just so happens
he's a convicted money launderer too. -
2:08 - 2:10We've spent a great deal of time
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2:10 - 2:13investigating a $1 billion --
-
2:13 - 2:14that's right, a $1 billion —
-
2:14 - 2:17oil deal that he was involved with,
-
2:17 - 2:19and what we found was pretty shocking,
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2:19 - 2:22but more about that later.
-
2:22 - 2:25So it's easy to think
that corruption happens -
2:25 - 2:27somewhere over there,
-
2:27 - 2:30carried out by a bunch of greedy despots
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2:30 - 2:32and individuals up to no good in countries
-
2:32 - 2:35that we, personally, may
know very little about -
2:35 - 2:36and feel really unconnected to
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2:36 - 2:40and unaffected by what might be going on.
-
2:40 - 2:43But does it just happen over there?
-
2:43 - 2:46Well, at 22, I was very lucky.
-
2:46 - 2:49My first job out of university
-
2:49 - 2:53was investigating the illegal
trade in African ivory. -
2:53 - 2:57And that's how my relationship
with corruption really began. -
2:57 - 3:00In 1993, with two friends
who were colleagues, -
3:00 - 3:03Simon Taylor and Patrick Alley,
-
3:03 - 3:07we set up an organization
called Global Witness. -
3:07 - 3:10Our first campaign
was investigating the role -
3:10 - 3:14of illegal logging in funding
the war in Cambodia. -
3:14 - 3:17So a few years later, and it's now 1997,
-
3:17 - 3:22and I'm in Angola undercover
investigating blood diamonds. -
3:22 - 3:23Perhaps you saw the film,
-
3:23 - 3:25the Hollywood film "Blood Diamond,"
-
3:25 - 3:27the one with Leonardo DiCaprio.
-
3:27 - 3:30Well, some of that sprang from our work.
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3:30 - 3:33Luanda, it was full of land mine victims
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3:33 - 3:35who were struggling
to survive on the streets -
3:35 - 3:38and war orphans living
in sewers under the streets, -
3:38 - 3:40and a tiny, very wealthy elite
-
3:40 - 3:43who gossiped about shopping
trips to Brazil and Portugal. -
3:43 - 3:46And it was a slightly crazy place.
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3:46 - 3:50So I'm sitting in a hot
and very stuffy hotel room -
3:50 - 3:53feeling just totally overwhelmed.
-
3:53 - 3:55But it wasn't about blood diamonds.
-
3:55 - 3:58Because I'd been speaking
to lots of people there -
3:58 - 4:01who, well, they talked
about a different problem: -
4:01 - 4:04that of a massive web
of corruption on a global scale -
4:04 - 4:07and millions of oil dollars going missing.
-
4:07 - 4:10And for what was then
a very small organization -
4:10 - 4:12of just a few people,
-
4:12 - 4:15trying to even begin to think
how we might tackle that -
4:15 - 4:17was an enormous challenge.
-
4:17 - 4:19And in the years that I've been,
-
4:19 - 4:21and we've all been campaigning
and investigating, -
4:21 - 4:23I've repeatedly seen
that what makes corruption -
4:24 - 4:26on a global, massive scale possible,
-
4:26 - 4:29well it isn't just greed
or the misuse of power -
4:29 - 4:31or that nebulous phrase "weak governance."
-
4:31 - 4:33I mean, yes, it's all of those,
-
4:33 - 4:36but corruption, it's made
possible by the actions -
4:36 - 4:40of global facilitators.
-
4:40 - 4:43So let's go back to some of those
people I talked about earlier. -
4:43 - 4:45Now, they're all people
we've investigated, -
4:45 - 4:47and they're all people who couldn't
do what they do alone. -
4:47 - 4:50Take Obiang junior. Well, he didn't end up
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4:50 - 4:54with high-end art and luxury
houses without help. -
4:54 - 4:56He did business with global banks.
-
4:56 - 5:00A bank in Paris held accounts
of companies controlled by him, -
5:00 - 5:02one of which was used to buy the art,
-
5:02 - 5:05and American banks, well, they funneled
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5:05 - 5:0873 million dollars into the States,
-
5:08 - 5:12some of which was used to buy
that California mansion. -
5:12 - 5:15And he didn't do all of this
in his own name either. -
5:15 - 5:16He used shell companies.
-
5:16 - 5:19He used one to buy
the property, and another, -
5:19 - 5:21which was in somebody else's name,
-
5:21 - 5:25to pay the huge bills it
cost to run the place. -
5:25 - 5:27And then there's Dan Etete.
-
5:27 - 5:29Well, when he was oil minister,
-
5:29 - 5:34he awarded an oil block now
worth over a billion dollars -
5:34 - 5:37to a company that, guess what, yeah,
-
5:37 - 5:40he was the hidden owner of.
-
5:40 - 5:43Now, it was then much later traded on
-
5:43 - 5:46with the kind assistance
of the Nigerian government -- -
5:46 - 5:48now I have to be careful what I say here —
-
5:48 - 5:52to subsidiaries of Shell
and the Italian Eni, -
5:52 - 5:54two of the biggest oil companies around.
-
5:54 - 5:57So the reality is,
is that the engine of corruption, -
5:57 - 5:59well, it exists far
beyond the shores of countries -
5:59 - 6:03like Equatorial Guinea
or Nigeria or Turkmenistan. -
6:03 - 6:05This engine, well, it's driven
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6:05 - 6:07by our international banking system,
-
6:07 - 6:10by the problem of anonymous
shell companies, -
6:10 - 6:12and by the secrecy that we have afforded
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6:12 - 6:15big oil, gas and mining operations,
-
6:15 - 6:19and, most of all, by the failure
of our politicians -
6:19 - 6:21to back up their rhetoric and do something
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6:21 - 6:26really meaningful and systemic
to tackle this stuff. -
6:26 - 6:28Now let's take the banks first.
-
6:28 - 6:30Well, it's not going
to come as any surprise -
6:30 - 6:35for me to tell you that banks
accept dirty money, -
6:35 - 6:39but they prioritize their profits
in other destructive ways too. -
6:39 - 6:42For example, in Sarawak, Malaysia.
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6:42 - 6:46Now this region, it has just five percent
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6:46 - 6:51of its forests left intact. Five percent.
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6:51 - 6:53So how did that happen?
-
6:53 - 6:56Well, because an elite
and its facilitators -
6:56 - 6:58have been making millions of dollars
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6:58 - 7:01from supporting logging
on an industrial scale -
7:01 - 7:04for many years.
-
7:04 - 7:06So we sent an undercover investigator in
-
7:06 - 7:10to secretly film meetings
with members of the ruling elite, -
7:10 - 7:13and the resulting footage, well,
it made some people very angry, -
7:13 - 7:15and you can see that on YouTube,
-
7:15 - 7:17but it proved what we had long suspected,
-
7:17 - 7:21because it showed
how the state's chief minister, -
7:21 - 7:23despite his later denials,
-
7:23 - 7:26used his control over land
and forest licenses -
7:26 - 7:29to enrich himself and his family.
-
7:29 - 7:34And HSBC, well, we know
that HSBC bankrolled -
7:34 - 7:36the region's largest logging companies
-
7:36 - 7:38that were responsible
for some of that destruction -
7:38 - 7:41in Sarawak and elsewhere.
-
7:41 - 7:44The bank violated its own
sustainability policies in the process, -
7:44 - 7:48but it earned around 130 million dollars.
-
7:48 - 7:50Now shortly after our exposé,
-
7:50 - 7:53very shortly after our exposé
earlier this year, -
7:53 - 7:56the bank announced
a policy review on this. -
7:56 - 7:59And is this progress? Maybe,
-
7:59 - 8:01but we're going to be
keeping a very close eye -
8:01 - 8:04on that case.
-
8:04 - 8:07And then there's the problem
of anonymous shell companies. -
8:07 - 8:10Well, we've all heard
about what they are, I think, -
8:10 - 8:12and we all know they're used quite a bit
-
8:12 - 8:15by people and companies
who are trying to avoid -
8:15 - 8:18paying their proper dues to society,
-
8:18 - 8:20also known as taxes.
-
8:20 - 8:23But what doesn't usually come to light
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8:23 - 8:27is how shell companies are used to steal
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8:27 - 8:31huge sums of money,
transformational sums of money, -
8:31 - 8:33from poor countries.
-
8:33 - 8:36In virtually every case of corruption
that we've investigated, -
8:36 - 8:38shell companies have appeared,
-
8:38 - 8:41and sometimes
it's been impossible to find out -
8:41 - 8:44who is really involved in the deal.
-
8:44 - 8:47A recent study by the World Bank
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8:47 - 8:50looked at 200 cases of corruption.
-
8:50 - 8:53It found that over 70
percent of those cases -
8:53 - 8:56had used anonymous shell companies,
-
8:56 - 8:59totaling almost 56 billion dollars.
-
8:59 - 9:01Now many of these
companies were in America -
9:01 - 9:03or the United Kingdom,
-
9:03 - 9:05its overseas territories
and Crown dependencies, -
9:05 - 9:07and so it's not just an offshore problem,
-
9:07 - 9:10it's an on-shore one too.
-
9:10 - 9:12You see, shell companies, they're central
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9:12 - 9:15to the secret deals which may
benefit wealthy elites -
9:15 - 9:18rather than ordinary citizens.
-
9:18 - 9:21One striking recent case
that we've investigated -
9:21 - 9:24is how the government
in the Democratic Republic of Congo -
9:24 - 9:29sold off a series of valuable,
state-owned mining assets -
9:29 - 9:32to shell companies
in the British Virgin Islands. -
9:32 - 9:34So we spoke to sources in country,
-
9:34 - 9:37trawled through company
documents and other information -
9:37 - 9:41trying to piece together a really
true picture of the deal. -
9:41 - 9:44And we were alarmed to find
that these shell companies -
9:44 - 9:47had quickly flipped many of the assets on
-
9:47 - 9:51for huge profits to major
international mining companies -
9:51 - 9:53listed in London.
-
9:53 - 9:56Now, the Africa Progress
Panel, led by Kofi Annan, -
9:56 - 9:59they've calculated
that Congo may have lost -
9:59 - 10:04more than 1.3 billion dollars
from these deals. -
10:04 - 10:07That's almost twice
-
10:07 - 10:12the country's annual health
and education budget combined. -
10:12 - 10:15And will the people of Congo,
will they ever get their money back? -
10:15 - 10:17Well, the answer to that question,
-
10:17 - 10:18and who was really involved
and what really happened, -
10:19 - 10:21well that's going to probably
remain locked away -
10:21 - 10:24in the secretive company registries
of the British Virgin Islands -
10:24 - 10:29and elsewhere unless we all do
something about it. -
10:29 - 10:32And how about the oil, gas
and mining companies? -
10:32 - 10:35Okay, maybe it's a bit
of a cliché to talk about them. -
10:35 - 10:37Corruption in that sector, no surprise.
-
10:37 - 10:41There's corruption everywhere,
so why focus on that sector? -
10:41 - 10:43Well, because there's a lot at stake.
-
10:43 - 10:48In 2011, natural resource exports
-
10:48 - 10:51outweighed aid flows by almost 19 to one
-
10:51 - 10:55in Africa, Asia and Latin America.
Nineteen to one. -
10:55 - 10:59Now that's a hell of a lot
of schools and universities -
10:59 - 11:01and hospitals and business startups,
-
11:01 - 11:03many of which haven't
materialized and never will -
11:03 - 11:08because some of that money
has simply been stolen away. -
11:08 - 11:10Now let's go back to the oil
and mining companies, -
11:10 - 11:13and let's go back to Dan Etete
and that $1 billion deal. -
11:13 - 11:16And now forgive me, I'm
going to read the next bit -
11:16 - 11:19because it's a very live
issue, and our lawyers -
11:19 - 11:21have been through this in some detail
-
11:21 - 11:24and they want me to get it right.
-
11:24 - 11:28Now, on the surface, the deal
appeared straightforward. -
11:28 - 11:31Subsidiaries of Shell and Eni
-
11:31 - 11:34paid the Nigerian
government for the block. -
11:34 - 11:36The Nigerian government transferred
-
11:36 - 11:39precisely the same amount,
to the very dollar, -
11:39 - 11:43to an account earmarked
for a shell company -
11:43 - 11:45whose hidden owner was Etete.
-
11:45 - 11:49Now, that's not bad going
for a convicted money launderer. -
11:49 - 11:50And here's the thing.
-
11:50 - 11:52After many months of digging around
-
11:52 - 11:56and reading through hundreds
of pages of court documents, -
11:56 - 11:57we found evidence that, in fact,
-
11:57 - 12:01Shell and Eni had known that the funds
-
12:01 - 12:04would be transferred
to that shell company, -
12:04 - 12:08and frankly, it's hard
to believe they didn't know -
12:08 - 12:11who they were really dealing with there.
-
12:11 - 12:14Now, it just shouldn't take
these sorts of efforts -
12:14 - 12:17to find out where the money
in deals like this went. -
12:17 - 12:18I mean, these are state assets.
-
12:18 - 12:20They're supposed to be
used for the benefit -
12:20 - 12:21of the people in the country.
-
12:21 - 12:25But in some countries,
citizens and journalists -
12:25 - 12:27who are trying to expose stories like this
-
12:27 - 12:28have been harassed and arrested
-
12:28 - 12:33and some have even risked
their lives to do so. -
12:33 - 12:36And finally, well, there
are those who believe -
12:36 - 12:39that corruption is unavoidable.
-
12:39 - 12:41It's just how some business is done.
-
12:41 - 12:43It's too complex and difficult to change.
-
12:43 - 12:46So in effect, what? We just accept it.
-
12:46 - 12:49But as a campaigner and investigator,
-
12:49 - 12:50I have a different view,
-
12:50 - 12:52because I've seen what can happen
-
12:52 - 12:54when an idea gains momentum.
-
12:54 - 12:57In the oil and mining sector, for example,
-
12:57 - 12:58there is now the beginning
-
12:58 - 13:02of a truly worldwide transparency standard
-
13:02 - 13:05that could tackle some of these problems.
-
13:05 - 13:07In 1999, when Global Witness called
-
13:07 - 13:10for oil companies to make
payments on deals transparent, -
13:11 - 13:14well, some people laughed
at the extreme naiveté -
13:14 - 13:16of that small idea.
-
13:16 - 13:20But literally hundreds
of civil society groups -
13:20 - 13:22from around the world came together
-
13:22 - 13:23to fight for transparency,
-
13:23 - 13:27and now it's fast becoming
the norm and the law. -
13:27 - 13:29Two thirds of the value
-
13:29 - 13:32of the world's oil and mining companies
-
13:32 - 13:35are now covered by transparency laws.
Two thirds. -
13:36 - 13:37So this is change happening.
-
13:37 - 13:39This is progress.
-
13:39 - 13:42But we're not there yet, by far.
-
13:42 - 13:44Because it really isn't about corruption
-
13:44 - 13:46somewhere over there, is it?
-
13:46 - 13:49In a globalized world, corruption
-
13:49 - 13:51is a truly globalized business,
-
13:51 - 13:53and one that needs global solutions,
-
13:53 - 13:57supported and pushed by us
all, as global citizens, -
13:57 - 13:58right here.
-
13:58 - 13:59Thank you.
-
13:59 - 14:06(Applause)
- Title:
- Meet global corruption's hidden players
- Speaker:
- Charmian Gooch
- Description:
-
When the son of the president of a desperately poor country starts buying mansions and sportscars on an official monthly salary of $7,000, Charmian Gooch suggests, corruption is probably somewhere in the picture. In a blistering, eye-opening talk (and through several specific examples), she details how global corruption trackers follow the money -- to some surprisingly familiar faces.
- Video Language:
- English
- Team:
- closed TED
- Project:
- TEDTalks
- Duration:
- 14:27
Krystian Aparta edited English subtitles for Meet global corruption's hidden players | ||
Thu-Huong Ha edited English subtitles for Meet global corruption's hidden players | ||
Thu-Huong Ha approved English subtitles for Meet global corruption's hidden players | ||
Thu-Huong Ha edited English subtitles for Meet global corruption's hidden players | ||
Thu-Huong Ha edited English subtitles for Meet global corruption's hidden players | ||
Morton Bast accepted English subtitles for Meet global corruption's hidden players | ||
Morton Bast edited English subtitles for Meet global corruption's hidden players | ||
Joseph Geni edited English subtitles for Meet global corruption's hidden players |