Domestic Corruption in International Disasters

The term corrupt is derived from the Latin verb corrumpere, meaning “collectively to destroy.” Synonyms include graft, sleaze (United Kingdom), and kickback. The term indicates a state of moral depravity possibly involving illegal activities or affairs. A further, perhaps more limited, definition offered by the civil society organization Transparency International is “the abuse of entrusted power for private gain.”

Although corruption can occur in any activity, it is concentrated in and around the underground economy (also known as the black economy or, perhaps euphemistically, the informal economy). It is estimated that almost a fifth of world trade is illegal; about half of this portion is connected with narcotics (including money laundering, the recirculation of illegal gains through licit activities), while much of the rest is bound up with arms dealing, human trafficking, and other forms of smuggling.

The confusion caused by disasters and the disruption to normal systems of accounting and expenditure controls mean that without special vigilance, corruption may flourish. Moreover, building is one of the sectors of the economy that offers the most opportunities for corruption. The boom period enjoyed by the construction trade during post-disaster reconstruction may offer many opportunities to profit without declaring taxes, to siphon off funds, and to falsify accounts. Moreover, the major organized crime syndicates may either have a stranglehold on the building trade, or sufficient liquidity to “back the winner” in every tender for reconstruction contracts. Political leaders may be part of organized crime, or amenable to bribery, thus tacitly condoning corrupt activities.

Major disasters involve large transfers of money, both domestically and internationally. This provides numerous opportunities to make funds disappear, indulge in fraudulent transfers on the basis of nonexistent services, and inflate invoices. Once again, political connivance is part of the process, and is achieved through bribery.

Corruption exists at all scales, from individuals to transnational organizations. It may be a spontaneous process or part of a sophisticated system run by organized crime syndicates. It also affects all phases of the disaster cycle. Hence, it can reduce opportunities to mitigate disaster impacts by weakening regulation of the building trade and siphoning off funds earmarked for risk reduction. By creating an environment in which preparedness is secondary to bribery and influence, it damages the ability to respond to disaster. Then, major new opportunities for graft and corruption suddenly appear with the funding of recovery and reconstruction.