Bribery vs Corruption – Which Is The Bigger Evil?

“Nearly all men can stand adversity, but if you want to test a man’s character, give him power”.

The words of wisdom from Abraham Lincoln echo in my head whenever I hear limitless lores of crimes committed under the power bridge. The hidden truth behind these words roars louder when we talk about bribery vs corruption.

Way before the Watergate Scandal, the infamous Teapot Dome Scandal caused noise and was also regarded as one of the most notorious and eye-opening tales of corruption by U.S. public officials in the 1920s.

Blighting the U.S. economies and ethical sustainability standards, the tale of bribery and corruption was a magnificent show of power abuse behind the disguise of black leather bags full of cash. The exchange of favors for financial and business motives leads to benefit law enforcement bodies with the captivation of cabinet officials behind bars.

This article will allow you to explore the intersection of bribery as a significant part of the corruption and economic sustainability seizure, the broad impacts of corruption with bribery playing a major role, the legislation fighting the epidemic of crimes, controlling measures, and much more.

Bribery and Corruption: Exploration of Thin Line Between Two

What else can set a better precedent than the saying of Plato “The measure of a man is what he does with power” while bribery and corruption are the ultimate exhibition of power being exploited through illegal financial and ethical activities.

What is Corruption?

Disguised behind the general statements of “It does not hurt anyone as everyone is doing it”, corruption is a deeply complex phenomenon with easy to phrase definition of attempting or committing a fraudulent activity by the means of holding power.

Power ceases to be held by any particular individual but people holding public offices or even an ordinary person with the potential to exploit the system.

With a common motive to gain personal favors, individuals with power abuse their position and commit corruption while locking horns with team good guys, law enforcement for instance.

It is crucial to understand the fact that among three prominent definitions of corruption by the Oxford English Dictionary, corruption in the government and administration hemisphere carries the most deteriorating essence than others.

Here’s what the corruption index known as Corruption Perception Index by Transparency International says about the crippling corruption across the globe.

Out of 180 ranked countries, two-thirds scored 50 out of 100 while the average lingers at 43. Where nations are sinking into corruption chaos, guess the kicker? The year 2023 recorded the lowest scores by 23 countries crying out loud for a massive cleanup.

What is Bribery?

Bribery, a mere symptom of deep-rooted corruption when infiltrates into public affairs, sub-standard economic sustainability becomes the future of nations. Incentivize those who aid you in committing illegal activities, said the bribery. Bribery can come in different shapes and forms because nobody watches the watchman.

Let’s draw the anatomy of bribery so you will know the next time you see someone offering a seasonal fruit basket in exchange for getting an anonymous account opened in a bank.

Types of Bribery

Bribery can exist in different types while the horrible impacts remain the same. Whether it comes in the form of bribery by a public official, foreign official, or banks, the social and economic cost remains on the edge. Let’s take a look at some types of bribery along with their real-time examples.

Bribery vs Corruption: Two Different Sides of a Coin

The difference between bribery and corruption can be tricky to spot with the notable fact that more than $3.6 trillion gets lost to international corruption behind the disguise of stolen money and bribes.

If we ponder enough on the instances from the past, it is not that difficult to comprehend that bribes have always been a part of big corruption sagas. How about having a sneak peek into a few case studies where history witnessed massive corruption scandals facilitated by bribery?

The Lores of Corruption and Bribery

Brazil Under Corruption Stroke

The corruption saga of Brazil exposed in 2014 is not hidden from anyone. The findings of Operation Car Wash revealed that several high-profile public officials and state-owned Oil Company (Petrobras) executives were involved in massive bribes. Construction contracts at inflated prices were awarded in exchange for millions in cash.

The allegations did not stop there as the Worker’s Party was found to favor politicians from the chunks of black funds in their electoral campaigns. Trespassing on the merit standards by issuing ineligible contracts and compromising democratic stability, it was the general public who paid the price.

Enigma of Panama Papers

The biggest leak of the year 2016, the Panama Papers exposed horrible corruption schemes of world leaders including bribery and tax evasion. Those 11.5 million files screamed the sophisticated tactics of twelve national leaders who were on top of the 146 politicians abusing their power.

Raising lots of questions on the justice and accountability system, the Panama leak made another crucial revelation about the potential of politically exposed persons (PEPs) and RCAs (Relatives & Close Associates). Access to power allows them to commit financial and ethical crimes such as money laundering, corruption, bribery, and tax evasion.

Compliance risks associated with potentially corrupt actors require businesses to employ strict scrutiny measures. Learn more about how PEPs and RCAs exploit informal networks for corruption.

Having the basics of bribery vs corruption explained, one might ponder on the cruciality of regulating these crimes, why does it matter? Though economists still struggle to accurately measure the impacts of corruption, thanks to its subjective definitions, it is not difficult to analyze the significant impacts of the epidemic on economic development and growth.

Evidential Impacts of Corruption and Bribery

Dwelling between being beneficial and a destroyer of economies, corruption is considered to be harmful to societies, supported by the research evidence. Along with discouraging investments, democratic harms, bleeding of resources, and ethical deterioration, corruption impacts the global economic environment on micro and macro levels. You heard it right.

If we have identified the problem then one might wonder what regulatory and law enforcement authorities are doing to tackle it. What has been done so far and what needs to be done more? Let’s take a look at global legislation designed to deal with corrupt actors.

Anti-Bribery and Anti-Corruption Framework

The plague of money bribe and money corruption has erupted like a volcano, what can be blamed? Technology or leniency to effectively adapt anti-corruption and anti-bribery frameworks?

The corruption index as mentioned earlier shows the weak dedication of different jurisdictions in imposing the corruption act and the bribery act against financial crimes. However, the United States and the United Kingdom seem quite aggressive in the matter. Below are the key legislations that are globally recognized in the fight against bad boys.

• FCPA (U.S Foreign Corrupt Practices Act: Enforces businesses to maintain strict compliance against corruption and bribery while imposing heavy fines upon non-compliance events.
• UK Bribery Act 2010: Known as one of the strictest legislations in the U.K. formed in 2011.
• OECD (Organisation for Economic Co-operation and Development) Convention: Requires compliance against bribery in International Business Transactions by foreign public officials.

When a regulation hits the ground, businesses seek a way around these legislations. The fear of non-compliance costs and reputational damages becomes the sole purpose of abiding by laws. I feel this unbridled urge to ask the authorities if this fear is enough to encourage businesses to follow the rules or if there can be a sense of accountability catching corrupt individuals off guard.

How To Find An Exit?

Modern problems need advanced solutions because if we do not leverage technology in our favor, fraudsters will. Where cutting-edge technology including Artificial Intelligence (AI) and Machine Learning (ML) has brought ease in many fields, anti-corruption is getting equal attention.

Compliance requires businesses to conduct corruption risk assessments before closing sensitive business deals and acquiring new clients. The diverse datasets of corruption and corrupt individuals allow a business to effectively screen any client or partner. Where to find such extensive and credible data sources and anti-corruption solutions?

AML Watcher is your credible compliance partner guiding you through the muddy waters of unforgiving regulations and sophisticated tactics of fraudsters aiming to pollute financial systems. Our Corruption Monitoring Solution leverages carefully hand-picked data from more than 180 countries to deter potential corrupt actors and save you from legal and financial costs.

Get in touch with AML Watcher’s compliance geeks for a safer and corrupt-free ecosystem.