We note very carefully that recovering stolen assets is important for a variety of reasons. According to the World Bank, the cross-border flow of proceeds from criminal activities, corruption and tax evasion is estimated to be between US$1 and 1.6 trillion per year, with half of this amount being looted from developing and transition economies, and Guyana certainly fits this category.

The breakdown is appalling: “US $20-40 billion of this flow originates in bribes to public officials from developing and transition countries. A 2005 report by the Commission for Africa actually cites a European Commission estimate that "stolen African assets equivalent to more than half of the continent's external debt are held in foreign banks accounts." A Guyana context is not likely to be dissimilar, and is worthy of some probing.

We did recently learn from Professor Clive Thomas, that in Guyana, “the labyrinth of slush funds, parallel treasuries, and looted state funds, exported to off-shore financial institutions, may run to a huge, $333-340 billion. And according to Minister of State Joseph Harmon, that figure “was upped to $500 billion” by a major external financial body.

We are talking here for a year, and should this figure be replicated at its minimum for 20 years, then we are dealing with astronomical losses suffered during the recent past. It is most instructive to note that the National Budget of 2014 was a mere $220B. It means we are contemplating the ludicrous reality that more money was stolen every year than what is left to run the country.

Professor Clive Thomas-Head of State Assets Recovery Unit

So it is correct to go along with the World Bank in 2004, that "corruption is... the single greatest obstacle to economic and social development. Corruption undermines development by distorting the rule of law and weakening the institutional foundation on which economic growth depends. The harmful effects of corruption are especially severe on the world’s poorest, who are most reliant on the provision of public services, and are least capable of paying the extra costs associated with fraud and corruption.

That is why Assets Recovery is quite en vogue and universal, and in fact any effort by governments to repatriate the proceeds of corruption, hidden in local or foreign jurisdictions, should be lauded. Overall, we are dealing with a criminal situation, and it is no surprise that Dominica was greatly commended for enacting serious legislation in this vein, even at the personal level.

We need no legal training to appreciate that ‘stolen items’ of any sort, whether monies in bank accounts, real estate, vehicles, arts and artefacts, and precious metals, are the actualities-they must be recouped as they are proceeds of crimes. It is plain, simple common sense, and even if it is to satisfy justice, then it should not escape the mind that a major pillar of nation building is that of its attitude towards justice.

Under the United Nations Convention against Corruption, assets recovery refers to recouping the proceeds or instrumentalities of crime in general, and inherent in this statement is that sense of justice. So what the Guyana Government is currently engaging in is wholly just and necessary; it is about a sense of ‘the rule of law’ and ‘giving back to the nation’ its deserved ‘fruits of hard labour.’

Onerous task

Assets Recovery is not easy, and takes expertise, expansive time and immense patience. We realise that when it comes to State Assets, those with criminal energy and intent, capitalise on the existing gaps between individual jurisdictions, to create their own systems for misconduct.

Utilising the gaps in the systems of international judicial assistance, hide the illegitimately achieved proceeds of their criminal actions, to the detriment of their victims (in Guyana’s case it is a whole nation).

It means that such gaps hurt twice: first, by creating opportunity for fraudulent behaviour; and secondly, by complicating the recovery of assets for all individuals who are defrauded, as they, themselves, are committed to play by the rules (or in other words who are not ready to engage in “Mafia methods.”

The victim then is always in second position and have to be “running after” the bad guys who are sometimes completely ensconced and at home in the gaps, and are therefore more than a step ahead.

Abundance of literature has it that overall, it truly requires a lot of energy, commitment, cunning and allocation of resources in order to successfully recover damages caused by fraud. “In addition to “good money” (deployed specifically to be invested in the recovery of the lost/bad money), recovery efforts demand a remarkable amount of time and energy, experienced advisers who are knowledgeable about how to find, pursue, identify, attach, enforce and collect lost assets, and more.”

A most important element in pursuing the recovery is the support provided to fraud victims by individual jurisdictions that are involved in the chain of transferring and hiding misallocated assets. The above-mentioned gaps need to be closed, and that requires a very close cooperation. Also, laws in the relevant jurisdictions need to provide powerful tools to freeze assets, which are potentially proceeds of fraud.

The UN estimated that the total amount of criminal misallocation of funds was approximately US$2.1 trillion or 3.6 per cent of the global gross domestic product of that year (2009). Remarkably, less than 1 per cent of these proceeds was successfully recovered. When hidden outside the jurisdiction of their origin the recovery rate is even lower.

In this vein, it is estimated, that should Guyana recover a mere ten per cent of ‘illegally stashed’ monies and properties, the figure will be a whopping GUY$600 billion.

Caution

One important aspect to consider before initiating an asset recovery project is, as always, the cost factor. The process of asset recovery often turns out to be quite cumbersome. It requires additional specialised personnel and the process can take many years.

Consequently, an economic decision must first be made at the beginning, and Guyana has already gone past this step, more so, that in the build up to the May 2015 Elections, the current Government did commit itself to this venture; now it is just a matter of keeping the resolve and honouring its word to an expectant citizenry.

The main question is, does the anticipated outcome justify the effort? The “sunk cost fallacy” must be avoided, else the end will be, “throwing good money after bad.”

In the Guyana context, we have already learned of huge sums of money that may have been inappropriately and illegally transferred, as well as many state vehicles that were ‘nearing being handed over’ to select individuals. We are also learning about employees, strategically positioned just to ‘collect money’ in the form of quasi positions and salaries.

Global support

Most jurisdictions are committed to and often required to grant judicial and administrative assistance in cases of asset tracing and recovery through international conventions and multilateral or bilateral treaties. The international community has recognised the importance of asset tracing and recovery:

• The United Nations Convention Against Corruption considers the return of stolen assets one of its fundamental principles, and requires its signatories to provide a factual and legal framework for effective cross-border recovery of assets.

• The European Union has introduced several legal instruments aimed at simplifying asset recovery and tracing – considered to be a strategic priority – across the jurisdictions of its member states.

Guyana can expect good support in this vein, as the commitment of mutual judicial and administrative assistance in cases of asset tracing and recovery is based on international, multilateral and bilateral treaties and conventions, many of which have been in effect for several years.

According to Minister of State (within the Ministry of the Presidency) Joseph Harmon, Guyana’s State Assets Recovery Unit would be independent but with broad powers, and “This unit will then make recommendations based on findings, after which all will be presented to the ruling administration for examination and action if necessary,” he said.

Distinguished Economics Professor Clive Thomas heads the Unit and his outline promises even more success: establish a specialised public body dedicated to the initiative for recovering stolen public assets; then invoke Guyana’s responsibilities, duties and entitlements under the UNCAC, that came into force in 2005, and to which Guyana acceded in 2008.

A very promising asset-recovery disclosure was made too. Minister of State Joseph Harmon recently admitted that the Government’s State Asset Recovery Unit is making significant progress in recovering assets of the state. He explained that the Unit is engaged in a lot of “behind the scenes” work, and that this has resulted in the recovery of several assets that were held by individuals.”