Reward a criminal to catch a criminal

THERE’S A tried and tested way for ordinary citizens to lawfully profit from the proceeds of corruption, while still enabling the government to recover stolen public funds.

From 2009 to 2013, one country in the world recovered the equivalent of P617 billion in public funds that were lost to corruption. Out of this recovered amount, P91 billion was paid to private individuals who provided inside information that enabled their government to discover corruption-tainted transactions.

Under a US law called the False Claims Act, ordinary citizens can expose graft and corruption committed by companies in their commercial dealings with the US government. If the information leads to a recovery, the whistle-blower earns 15-35 percent of all amounts that the US government receives by way of recovery or huge fines. In a number of these cases, the whistle-blowers were employees who assisted their employer-companies to accomplish the fraud, and they provided information that showed the trail of corruption.

In 2008, Sen. Miriam Defensor Santiago filed a bill that sought to adopt a “False Claims” law for the Philippines. The bill was a virtual duplicate of the US law; the point was, if it has already proven effective elsewhere, why reinvent the wheel? But the bill was never passed. There were also efforts in the House of Representatives to pass a measure giving rewards of P50,000 to P200,000 to those who blow the whistle on corruption in the government, but even that was never approved. These failed efforts speak volumes on the lack of serious intent in Congress to fight corruption.

Without a law like the False Claims Act, the search for corruption-stained contracts is done with government agencies examining transactions that are externally packaged to look, sound and smell like pious works. The Office of the Ombudsman and the Department of Justice examine suspicious deals and contracts like roadside bystanders peering through the window of a private contractor’s house. These agencies largely rely on the possibility that, by chance, a conscience-stricken employee of the private contractor will squeal on the thievery of public funds. There is no reward for the risk to life and limb, except the patriotic feeling of having done a good deed for the motherland.

With a law like the False Claims Act, every employee working in a private contractor’s house can become a potential whistle-blower who will come out of the house and hand crucial evidence to government investigators who are virtual roadside bystanders. Every employee of a company that has corrupt dealings with the government will be given a financial incentive to reveal corruption schemes that result in the theft of public funds or loss of potential government revenues. The bigger the government’s loss, the bigger the reward for the whistle-blower, and, as a consequence, the bigger the possibility that an employee will come out of the contractor’s house to provide government investigators with explosive evidence.

One US senator rationalizes giving rewards to whistle-blowers, many of whom are engaged in unethical or outright criminal activities themselves, “upon the old-fashioned idea of holding out a temptation, and ‘setting a rogue to catch a rogue,’ which is the safest and most expeditious way … ever discovered of bringing rogues to justice.” The trick is to reward a criminal to catch a bigger criminal.

A law like the False Claims Act has the effect of deputizing every citizen to become a corruption-buster with potentially huge rewards for his or her efforts. It likewise creates a culture of paranoia among companies and government officials who may be predisposed to enter into graft-ridden deals, and force them to avoid engaging in corrupt transactions.

The Global Financial Integrity, an international research organization, estimates that the Philippine economy was cheated of P6 trillion from 1960 to 2011, or an average of over P357 billion yearly. Most of these are tax and customs revenues lost because of conspiracies between importers and government personnel. On the other hand, the Commission on Audit (COA) has reported that out of national budget expenditures, the government lost P102 billion to graft and corruption in 2011 alone.

These figures constitute the mere tip of the corruption iceberg because they were gathered by either researchers doing investigative work as bystanders or COA auditors examining documents whose wordings are crafted to cover up corruption. Imagine the entire corruption iceberg getting exposed in all its enormity, and melting in the resulting public exposure, if employees of corrupt companies are given huge incentives to expose corruption.

It may well be true that incoming president Rodrigo Duterte is serious in his election promise to stamp out corruption during his six years in office. But what happens after he leaves office? All his anticorruption initiatives can be reversed by his successor. This has been the sad history of leader-dependent crusades in a country like the Philippines.

Duterte is in search of a lasting legacy. During the election campaign, he theatrically declared his willingness to be martyred by riding a Jet Ski to a disputed but Chinese-occupied islet in the Spratlys and planting the Philippine flag.

If Duterte can stamp out corruption and marshal Congress to pass laws that will remove corruption from the country’s bloodstream starting from his term and beyond, he will be a leader worthy of a more glamorous martyrdom in the hallowed grounds of Luneta.

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