How the UK deals with dirty "corruption" money

The confiscation case of James Ibori, a former Nigerian politician, is a pivotal opportunity for the UK to test its commitments and ensure the proceeds of corruption return to their rightful victims, says Transparency International UK [TI].

• https://www.transparency.org.uk/new-confiscation-case-will-test-uk-s-commitment-transparent-asset-return

Read TIs Observations here…..

In late July, at Southwark Crown Court in London, Judge Tomlinson ordered Ibori to give up £101 million to the UK authorities within three months.

• https://www.reuters.com/world/uk/london-judge-orders-confiscation-130-mln-nigerian-ex-governor-ibori-2023-07-21/

Ibori had already served seven years in prison after pleading guilty in 2012 to ten counts of fraud and money laundering. The baffling delay between his imprisonment and the confiscation order reads like a long, complicated thriller.

• https://www.spotlightcorruption.org/james-ibori-confiscating-the-corrupt-assets-of-a-nigerian-governor/

Following his release, Ibori returned to Nigeria, where a cheerful crowd welcomed him and allowed him to return to public life as if nothing had happened – recent photographs show him befriending the current president Bola Ahmed Tinubu.

• https://twitter.com/thecableng/status/1679411386923843585

There are, however, some reasons to be optimistic and believe Ibori's confiscated assets would return transparently to the people of Nigeria.

In 2017, the UK pledged its commitment by signing the 10 GFAR principles, emphasising the public disclosure of information about "the transfer and administration of returned assets."

• https://star.worldbank.org/gfar-principles

You may also recall the 2022 Framework for transparent and accountable asset return and find that the UK was "the first country to publish" a policy of its kind. Also, Nigeria and the UK had already signed a Memorandum of Understanding in 2016 for the transparent return of assets, and the UK has already used it to repatriate some money through this mechanism.

• https://www.gov.uk/government/publications/return-of-stolen-assets-confiscated-by-the-uk-agreement-between-the-uk-and-nigeria/mou-between-uk-and-nigeria-on-the-modalities-for-return-of-stolen-assets-confiscated-by-the-uk-annex-1

Working against this, though, is the burden of past examples.

• Even for the most hopeful of us, it is difficult to deny that the UK's previous attempts to return assets to the victims have often followed an opaque pipeline leading to questionable outcomes.

There are at least four cases worth remembering.

1. On Ibori's case, the Home Office had already returned £4.2 million under the MoU with Nigeria.
   • However, anti-corruption practitioners have raised concerns about how the money was invested, as the returned funds were used outside of the Delta state – where the money had been stolen from initially.
   • https://www.thecable.ng/sagay-using-4-2m-ibori-loot-for-projects-outside-delta-unacceptable
2. In 2019, Pakistani tycoon Malik Riaz Hussein and the National Crime Agency (NCA) reached an out-of-court settlement to an "immediate repatriation" of £190 million.
   • As Hussein himself made clear, his acceptance to settle did not represent an admission of wrongdoing, although the agreement was reached as a conclusion of a "dirty money" police investigation.
     1. https://www.theguardian.com/uk-news/2019/dec/03/pakistani-tycoon-malik-riaz-hussain-hands-over-pounds-190m-to-uk-authorities-nca-
   • It was considered a great success for the NCA at the time, but details of the agreement remained private despite urgent civil society calls for greater transparency.
   • When the NCA returned the funds, without any NGO oversight, it fanned a political crisis in Pakistan.
   • The former Pakistani Prime Minister Imran Khan was arrested for allegedly receiving a bribe of 20 hectares of land and millions of rupees in exchange for allowing Malik Riaz to use the money to pay a supreme court settlement in Pakistan. Riaz's lawyers said it was the "whole point of the agreement (to) reach an amicable settlement." Mr Khan denied the charges saying the land was donated for charitable purposes.
3. The DJ Izzat Khanim Javadova, cousin of Azerbaijan's President Ilham Aliyev, and her husband handed £4 million to the NCA as part of another out of court settlement after a district judge said they used a "money laundering scheme" by moving funds through the Azerbaijani Laundromat. Initially, the authorities had frozen £14 million.
   • https://www.standard.co.uk/news/uk/laundromat-couple-izzat-khanim-javadova-suleyman-javadov-4m-pounds-evening-standard-win-b944136.html
4. And then there is the family of former Azerbaijani MP Javanshir Feyziyev who also forfeited £5.6m in civil proceedings without admission of guilt to corruption, which also went through the Azerbaijani Laundromat.
   • https://www.theguardian.com/business/2022/jan/31/azerbaijan-laundromat-court-orders-family-to-hand-over-56m-brought-into-uk

What lessons can be learnt from this experience? A couple comes to mind.

1. First, what is notable is that none of the settlements agreed upon in cases 2 and 3 were made available to the public.
2. As we made clear in TIs joint letter to the NCA in the Malik Riaz Hussain case, publishing settlements is crucial to ensuring confidence in the process. Thankfully, they have adopted a policy stating that these agreements will be transparent by default going forwards, but we have yet to see this tested in practice.
3. Even when returning the money to the country has proved challenging, the repatriation process should be open and accountable in accordance with GFAR principles.
4. Failing to allow oversight of asset returns increases the risk of the money being lost to corruption again or causing political unrest.
5. The lack of transparency and involvement of civil society can have serious consequences, as we can now see in Pakistan.

CONCLUSION

1. The Ibori case is a golden opportunity for the UK to demonstrate that it has learnt from recent mistakes and can provide leadership on returning assets transparently and accountable.
2. As there have been few good news stories in this field in recent years, it should grasp this opportunity with firm hands.
3. While Mr Ibori will likely appeal Judge Tomlinson's decision, the UK Government should consider how they plan to involve non-governmental stakeholders and the mechanisms they will use for the money to be returned to the ultimate victims of corruption, the people of Nigeria.

Source

• transparency.org.uk/new-confiscation-case-will-test-uk-s-commitment-transparent-asset-return