combined reputational weight and
technical abilities of its founding organizations, StAR helped restart cooperation bet ween the governments
of Haiti and Switzerland.
The combined efforts of Swiss, Haitian and St AR officials, including persons from over half a dozen countries,
resulted in a February 2009 order by
the Swiss authorities to confiscate and
transfer the frozen funds to Haiti. 5
This victory was threatened, however,
when Switzerland’s Supreme Court ordered, on January 9, 2010, the release of
Duvalier’s assets on the grounds that
the statute of limitations had expired.
Now a force in the global effort to
return stolen assets, the Swiss government, citing constitutional powers, took a bold step by refreezing the
assets. This provided time for passage
of an innovative law on corrupt assets
that was scheduled to be voted on by
the Swiss Federal Assembly in early
October 2010.6 Federal Councillor Eve-line Widmer-Schlumpf underscored
its importance, stating that Duvalier’s assets are “blocked again…to prevent it from going somewhere that it
shouldn’t for political reasons.” 7
BATTLING CORRUPT LEADERS
ACROSS THE REGION
Even with the fate of Duvalier’s assets still in limbo, the emergence of
St AR and other global tools for combating high-level graft offers a measure of hope for Latin American and
Caribbean countries, where corruption not only threatens sustainable
economic growth, but is often tightly
bound with crime, terrorism and environmental degradation. While all
forms of corruption have negative
consequences, the corruption of top
leaders systemically weakens government institutions by encouraging subordinate officials to engage in similar
practices. Perhaps the most insidious
damage is that top officials and political leaders not only amass fortunes
for personal pleasure, but use their
wealth to secure continued political
dominance. 8
The international financial system
compounds the problem by enabling
corrupt leaders to hide their assets
in foreign countries. By laundering
money into offshore financial cen-
ters, corrupt officials can protect their
assets from prying eyes of their own
government and civil society.
Countries such as Panama are
frequently identified as tax havens
where secrecy laws facilitate the accumulation of illicit assets and hinder
asset recovery investigations. But according to Raymond Baker, who studies the flow of illicit capital, at least 60
jurisdictions with high bank and incorporation secrecy facilitate money
laundering worldwide. 9
Recovering the proceeds of corruption in foreign countries presents a
challenge for law enforcement organizations. Obtaining cooperation from
other countries can take months, if
not years, and successful recoveries
often require understanding the in-tricacies of multi-jurisdictional litigation and foreign legal systems. This
knowledge and experience can be
found in the private sector, but the
costs of outside counsel are often prohibitive for governments.
In the past, efforts to recover stolen
assets were stymied by difficulties in
securing cooperation from recipient
countries, by legal systems incapable
of confiscating funds without a concurrent criminal conviction and by
ASSETS FROM CORRUPT LEADERS BY MARK V. VLASIC AND GREGORY COOPER
