G7 Urged to Tackle Global Corruption

G7 Urged to Adopt Financial Tools of Pressure to Promote Open Societies, Tackle Corruption and Kleptocracy

June 10, 2021 (London / Washington, DC) – In advance of the G7 summit beginning tomorrow, The Sentry has outlined key policy recommendations that the seven nations—the United States, the United Kingdom, Canada, France, Germany, Italy, and Japan—should adopt to combat the grand corruption undermining global peace and democracy.

Denisse Rudich, Senior Advisor at The Sentry, said: “Following President Biden’s historic memorandum making the fight against corruption a core national security interest and similar statements by other G7 countries at the United Nations, the time is now for the G7 to turn words into action. The G7 countries act as destinations, and often safe havens, for much of the illicit proceeds of kleptocratic networks plundering the public coffers of some of the most severely conflict-affected countries. Public wealth stolen from East and Central Africa does not stay there but moves across borders, often facilitated by professional enablers located in the G7, undermining the integrity of the global financial system. It is essential and urgent that G7 leaders act now to set the global agenda and commit to deploying financial tools of pressure, such as human rights and corruption sanctions, as well as tougher anti-money laundering measures, to disrupt corruption- and atrocities-related money flows and create leverage for peace, human rights, and good governance.”

The Sentry recommends that the G7 take the following concerted action steps:

1. The G7 should commit to using a wider toolkit of tools of financial pressure to target systemic corruption and human rights violations. Consideration should be given to adopting a multi-faceted approach to targeting kleptocracies, using anti-money laundering measures, targeted network sanctions, and law enforcement action to effectively bring about systemic change in kleptocracies and tackle corruption and human rights abuses.
2. The G7 should signal an intention to adopt Human Rights and Corruption Sanctions regimes in due course. All G7 countries should commit to enacting targeted sanctions against the networks of elites and their enablers engaging in rampant corruption and economic mismanagement. Countries have long recognized the use of sanctions as an effective tool to advocate for and encourage change in some of the world’s most repressive nations. Sanctions can act as a deterrent to and create accountability for corruption and gross violations of human rights.
3. The G7 should pledge additional resources to help improve the effective implementation and monitoring of anti-money laundering and anti-corruption measures. This could include (1) a commitment to explore the coordinated issuance of country advisories and public notices detailing money laundering and corruption risks for kleptocracies, which can assist in sharing vital information across the public and private sectors; (2) a pledge to bolster efforts to improve supervision of banks and designated non-financial businesses and professions (DFNBPs) and commit to impact-focused outcomes; and (3) the creation of a task force to monitor G7 compliance with commitments on anti-corruption measures to show leadership in this space
4. The G7 should commit to introducing additional transparency requirements for state-owned enterprises, including beneficial ownership disclosures. The United Nations Office on Drugs and Crime’s Oslo Statement on Corruption Involving Vast Quantities of Assets recommends that “state-owned or -controlled enterprises should disclose their management structures, revenues, expenditures and profits, and disclosure should be required of the beneficial ownership of the supplier companies providing services or goods, and the value accrued by public officials or politically exposed persons through contracts to private companies during their tenure at State-owned or -controlled enterprises, in line with national legislation” (Recommendation 4). State-owned enterprises should also be required to maintain and make public beneficial ownership information.
5. The G7 should commit to introducing legislation detailing civil recovery powers. This would allow law enforcement in countries to be able to freeze and seize assets and compel individuals to explain their source of wealth used to purchase assets (similar to Unexplained Wealth Orders in the UK). It would also allow for the freezing of illicit funds in banks and financial institutions without the need for a criminal conviction, which can be a lengthy process.
6. The G7 should encourage the adoption of public-private partnerships, including collaboration with civil society to address anti-money laundering and countering the financing of terrorism,  as well as corruption. Innovative collaboration between the public and private sector is essential. The UNODC Oslo Statement on Corruption Involving Vast Quantities of Assets recommends that “consideration should be given to developing formal and informal mechanisms and encouraging closer public-private sector collaboration to tackle corruption involving vast quantities of assets, including by cooperating with civil society to complement the work of Governments and the private sector” (Recommendation 13).

Click here to read The Sentry’s full brief.

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About The Sentry

The Sentry is an investigative and policy team that follows the dirty money connected to African war criminals and transnational war profiteers and seeks to shut those benefiting from violence out of the international financial system. By disrupting the cost-benefit calculations of those who hijack governments for self-enrichment, we seek to counter the main drivers of conflict and create new leverage for peace, human rights, and good governance. The Sentry is composed of financial investigators, international human rights lawyers, and regional experts, as well as former law enforcement agents, intelligence officers, policymakers, investigative journalists, and banking professionals. Co-founded by George Clooney and John Prendergast, The Sentry is a strategic partner of the Clooney Foundation for Justice.