2^ND GLOBAL INVESTIGATIVE JOURNALISM CONFERENCE,
MAY 1-4 2003, COPENHAGEN, DENMARK

EXPOSING THE CORRUPT TIES BETWEEN GOVERNMENT AND BUSINESS:
OLD AND NEW METHODS

By William Nyarko,
Executive Director, Ghana Centre for Public Integrity

wnyarko@hotmail.com

Introduction

Corrupt ties between government and business are usually formed or created at the interface between government and the private sector typically over procurement, which also feeds into political party financing and bureaucratic corruption. The players are usually public servants, politicians, business people and multinational businesses.

WHY CORRUPT TIES BETWEEN GOVERNMENT AND BUSINESS ARE BUILT AND SUSTAINED IN AFRICA

. Lack of effective checks on power- In some African countries, public officials who take decisions to award government contracts have unbridled discretionary powers and because institutions of vertical and horizontal accountability are weak coupled with the lack of proper procurement procedures, corrupt ties are built and sustained between the private sector and government.  

In his widely published work on corruption, Robert Klitgaard argues that the phenomenon of corruption can be analysed and remedial actions sought to deal with the canker if we accept the formula C= M+D-A, where Corruption equals “Monopoly” plus ‘Discretion” minus “Accountability”. In the case of procurement, corruption can occur if multiple checks and balances to ensure accountability, are absent.

In a recent discourse on enhancing transparency and accountability in governance in Ghana, Prof. Kwasi Prempeh of the Ghana Centre for Democratic Development noted that in less developing economies, corruption occurs when there is Motive and Opportunity and amended Klitgaard’s formula from the C=M+D-A to C=M x O where Corruption equals ‘Monopoly’ multiplied by ‘Opportunity’.

He argued that in developing countries in particular; ‘Corruption is a Crime of Opportunity (the opportunity being the institutional or system deficiencies that make it easy for corruption to occur and for the corrupt to get away with the crime) and Motive (the motive being that need, condition or state of affairs that serves as an inducement, incentive or motivation) that propels or compels a person to act on or succumb to a corrupting temptation.

§        Environment of Political and Corporate Governance Deficits in Africa

An environment of political and corporate governance deficits coupled with weak institutions of vertical and horizontal accountability can exacerbate such situations, nurture corrupt ties and sustain the corrupt relationship. In particular, a ‘closed’ political system which does not have enforceable transparency enhancing legislation like Whistleblower, Assets Declaration, Freedom of Information laws, enforceable rules and regulations on political contributions and clear rules on conflict of interest, can enable corrupt ties to flourish.

Similarly, in an environment of corporate governance deficits where enforcing business ethics is a real challenge and businesses know they cannot be sanctioned for engaging in unethical business practices, this can encourage and sustain corrupt ties between government and business.

How procurement procedures are manipulated for favourites

·    Eligibility requirements might be so narrowly defined as to eliminate all but one firm

·    Pre-qualification requirements are submitted so that the firms submitting bids are not qualified and a preferred one gets the contract

·    Deadlines are publicised without enough time for firms to comply except for one that knew beforehand of the call for tender and

·    Information about the other bids is sold to one firm that is able to get the contract

Additionally, ‘Transparency International’s 2000 Source Book on Confronting Corruption: The Elements of a National Integrity System’ notes that before contracts are awarded, the purchaser can:

·    Claim urgency as an excuse to award to a single contractor without competition

·    Breach the confidentiality of suppliers’ offers

·    Take bribes

·    Collude to fix bid prices

·    Promote discriminatory technical standards

·    Interfere improperly in the work of the evaluators; and

·    Offer bribes

There are also instances where companies bidding for a contract register several companies and in a descending order, graduate prices and specifications by a slight margin so that ‘head they win, tail they win’!

Military procurement has also been identified worldwide as an area prone to corruption because of the tendency of governments to raise national security issues to justify why defence procurement must be secret. In more accountable societies, the military has found a way of limiting opportunities for corruption in contract awards through selective tendering.

Tip sheet on Old and New Methods for investigating corrupt ties between government and business

A combination of old and new methods of investigation is crucial for effective exposure of the corrupt ties between government and business.

However, the use of computers and Internet based resources in investigations has brought new opportunities to information gathering and has been found to be particularly beneficial to investigative journalists in developing countries in Africa where there is hardly any transparency enhancing legislation like Freedom of Information. Information that civil servants will not officially make available because of the existence of an Official Secrets Act has sometimes been found on the Internet. Computer Assisted Reporting (CAR) methods have therefore assisted significantly in shedding light on business transactions and facilitated exposure. However, information through CAR poses credibility challenges. Mr. Ernest Brown of the Network Computer Systems in Ghana has developed the following steps to overcome that challenge.

 

(i)      Identify the owners and sponsors of the website by typing the URL into the search engine www.nsi.com. Also review the site’s About Us statement.

(ii)              Ascertain the credentials of the author or publisher-If the author is a dealer in iron-rods and car spare parts and has written about Space Programmes, how seriously should you take the author?

(iii)            Web page accuracy-Can the information be found in a non-related website? Does the web page give sources of information or does the web page contain grammatical or spelling errors?

·        Team investigations-The days when the investigative journalist was thought of as the ‘lone ranger’ are gone. The sophistication, expertise and cross-country nature of investigations required in ensuring timely and successful investigations demand that team investigations when appropriate, must be employed.

·        Network of local, regional and International Investigative Journalists- Membership of a network of investigative journalists like the Centre for Public Integrity’s International Consortium of Investigative Journalists, the Investigative Reporters and Editors global membership of investigative journalists have proved useful new methods of carrying out cross-country investigations. Join one if you’re not already a member.

·        International Conventions and opportunities for access to information: Old and more recent anti-bribery Conventions like the Foreign Corrupt Practices Act of the United States and OECD Convention respectively present new opportunities for exposing the corrupt ties between government and business.

Additional tips to consider are;

·        Follow the benefits-In any corrupt interface, there are always benefits to the parties involved in the transaction. The benefits could be tangible or intangible. It is important that the investigation establishes the benefits that accrued to the business and the public servant who took the decision or facilitated the contract award. For most public servants the rewards come in tangible forms; monetary rewards, payment of school fees for children in expensive schools, gifts of vehicles or houses, free tickets for entire family and promise of employment after public service etc. With monetary rewards, the investigation must follow the money by locating bank accounts and assets (sometimes hidden in the name of spouses, children, relatives and friends).

·        Executive appointments: The appointments of persons without ‘known’ public political ties to Boards of Public Corporations is good signal to unraveling Government-Business ties. In some cases, businessmen serving on Public Boards siphon funds into their private companies and bank accounts abroad through dubious contract awards and in turn make heavy political contributions to the governing party.

·        Look for the powerpoints: Sometimes a company’s influence could be located in many powerpoints. It could comprise a combination of centres of power in the ruling party; public servants and even in the Executive. Conduct of an audit of the access points through discreet talks with multiple sources in the party, government, security, opposition parties and critics has proved useful.

·        Assess the power of those under your investigation-It is important that time is spent to assess the influence that those being investigated have and the extent to which they can go to prevent being exposed. Naturally, nobody, not even journalists would like to be disgraced and those facing exposure may stop at nothing to prevent being exposed.  Tactics employed could range from bribing the investigator; using your editor or family members to dissuade you from continuing with the investigation; telephone threats and following up on the threats by maiming or killing the investigator. The unfortunate gunning to death in November 2000 of Carlos Cardoso for his ongoing investigations into the theft of 144 billion meticais (about $14 million) from the Commercial Bank of Mozambique in which ‘powerful and wealthy businessmen’ Momade Abdul Assife Satar and Ayob Abdul Satar were alleged to be involved, should provide us with useful lessons.

·        Did the company make political contributions to the politician/political party? Finding out if a company being investigated made contributions to a political party or to the politician who took the final decision in the award of a contract, could deepen ones understanding and further unravel the mysteries. Information from party insiders, political opponents and companies that lost out in the contract bid could be very valuable.

·        Focus on the intelligence and take coincidences seriously: The outcome of any successful investigation depends not only on the ability to gather documentary or electronic evidence but more importantly how sometimes isolated and seemingly unrelated events can be pieced together and analysed along with documents to provide the incontrovertible evidence. It requires a commitment to detail and not ignoring what appears to be trivial. In the African environment, as in other developing countries, where nepotism is a problem, it is often useful to find out (in the case of a politician and business executive in a contract award) if they have any ties- schoolmates, family relations, workmates, old acquaintances, Church members, membership of social clubs etc. This could provide invaluable intelligence to assist the investigator contextualise the investigation.

·        What is the company’s track record? Find out if the company has executed any contract either in the country or abroad and evaluate how it got the contract and whether it executed it satisfactorily. Some companies have a bad reputation for paying bribes to secure contracts and doing shoddy jobs and the company being investigated may very well in that league. Use the public available information sources (newspapers, radio, and television).

·        How was the contract awarded? Following the trail of how the contract was awarded; whether there was a tender; what kind of tender; (National or International, sole-sourcing or open competitive bidding) and evaluating the reasons offered by those who awarded the contract could be valuable. Note that not all sole sourcing contracts may be bad, it is the reasons given by those who awarded the contract for choosing that route that must be evaluated to determine whether it was warranted? Also if there was a board, locate and talk to individual members of the Tender or Procurement Board.

·        Locate the companies that lost out in the tender and talk to them-Companies that believed they put up a good bid and should have been awarded the contract would naturally feel aggrieved especially when they have insider information that indicated that the process was ‘rigged’ in favour of the company that won the contract. Locate and talk to them but be careful about taking their insights as ‘gospel’ because they may just be bad losers. 

·        Secure a copy of the contract document and if possible give a copy to experts to deepen your understanding of the issues

·        Once you have completed your investigation interview those you have been investigating and give them the opportunity to comment on the outcome of your investigation. Do not consider this as a privilege you’re offering to them; it is their right and you must give them the opportunity to respond to the specific allegations you'll raise against them in your report. In writing the report, be mindful of how you package it otherwise weeks or months of your investigation would come to naught.  

·        Follow-up, follow-up, follow-up-The investigative report doesn’t end with the publication or broadcast of the ‘first story’; it actually begins with it. Staying on top of the story and looking for new angles as well as reporting reactions to the story are crucial to ensuring an overall successful investigative report.

Conclusion: Certainly, the old and new methods of investigation would yield much better results if there is an institutional and legal framework that provides for transparency enhancing legislation which facilitates exposure i.e. a Free and responsible media, enforceable procurement rules, verification of Assets Declared, Freedom of Information and Whistleblower laws.

WRITING FOR IMPACT

Ten tips to crafting a readable investigative story

By David Boardman, The Seattle Times

Email: dboardman@seattle.com

1.     Report relentlessly. Good writing, no matter how lyrical, cannot make up for incomplete reporting. Leave no good source or document unturned.

2.     Prospect for nuggets. The writing process begins long before you sit down at the computer with your notes. Carefully noted details will be the gold of your story. Gather them vigorously; use them selectively.

3.     Save time by taking time. Invest in proper preparation before you sit down to write the story. Write a short abstract with the major points you want to make. Construct a detailed outline. Identify your best quotes. Play with leads.

4.     Become an “author.” Employ the tools of good literature: Character development. Plot. Narrative tension. Denouement. But don’t get carried away: DO let the facts get in the way, even when they make your story tougher to tell. Elegant narratives that bend facts are a disservice.

5.     Show AND tell. A good investigative story combines powerful declarative statements and telling examples. If you can’t produce both – a nut graph that summarizes your findings, and clear, telling illustrations – you likely have a fundamental problem and should do more reporting.

6.      Learn to love gray. Too many journalists see only two colors in an investigative story: black and white. Good and evil. Heroes and villains. But the best, most compelling stories are those that recognize and explore the grays that color almost every situation. Find them and capture them for readers.

7.      Leave most of your work in your notebook. In any good investigative story, the ratio of notes and research to length of a story should be enormous. If you’ve included most of what you’ve gathered, you’ve probably reported too little or written too much.

8.     Think presentation.  Whatever your medium, you must consider and anticipate your readers’ full experience with your story. Use your medium’s other tools – photographs, graphics, visuals, audio – to enhance that experience and to lift some of the burden from your words.

9.      Remember the reader. Simplicity and clarity are eternal virtues. Minimize your use of numbers, jargon and bureaucratese. And avoid overripe, pompous prose. The story’s weight should lie in the facts, not in your word choices.

10.            Revise, revise, revise. When you think you're done, you're probably not. Give the story another once over lightly for pace, clarity and word choice. Remember, it's when the narrative is in "final" form that polish produces its best sheen. And when you turn the story in to your editor, be open to revisions. If it isn’t working for your editor, it probably won’t work for readers.

Investigative Journalism Conference, Copenhagen, 26-29 April 2001.

Tips for Investigating Intelligence Activities

Nicky Hager, New Zealand    0064 4 3845074, nicky@paradise.net.nz

1.     Intelligence agencies can appear hopelessly impregnable. The information is inside the walls and we are on the outside. But security is usually more impression than reality. In every government agency (and private companies), no matter how strict the security, the secrets walk in and out of the doors every day as people go to and from work.

2.     Don’t assume that all intelligence officers are the same. Every organisation has a range of people, with a range of political and ethical views, some of who may welcome the opportunity to talk.

3.     Finding insiders willing to help you get information is a matter of persistence and, partly, luck. Word of mouth is the most successful way of finding people, but lots of work can be done to increase the likelihood of hearing of potential sources.

4.     Intelligence officers have the usual network of family, friends, neighbours, professional contacts, old university colleagues, sports associates and so on. These are the people from whom we hear about people in intelligence jobs and whether they seem open-minded. Leads can be actively sought from people in relevant university departments (eg. languages, mathematics and computing for intelligence agencies), elsewhere in the same general profession (eg. information technology specialists), in the public service union and in the military. Obviously, towns and cities near intelligence facilitites are good places to look. Note too that sometimes an intelligence officer speaks out and is reported saying a few things in the news, but no one ever thoroughly interviews them to gather all their other stories and insights. Approach them.

5.     For me, staff lists have been the key to getting inside intelligence agencies. Some of this information was compiled from scattered sources, but the most came from finding intelligence officers’ names hidden within military staff lists. This provided the structure for all my research.

6.     Investigating staff can feel obtrusive, but we can ensure that no personal information is ever used. For instance, knowing staff can give clues to the locations and sizes of intelligence operations and to overseas postings to allied intelligence services. In one case, studying the location of staff allowed me to discover a large but previously unknown interception site. All kinds of unclassified or low-classified lists might be useful: government pay records, government job advertisements, union membership lists and so on.

7.     Internal phone directories can be extremely useful: for instance military phone directories, which are not very secret, include many people who assist intelligence activities or may come from or go to an intelligence job. Public telephone books, lists of registered voters, registers of property owners and published university results can all help trace people.

8.     Even very secret information is usually located in more than one place and some of those locations are easier to assess than others. For intelligence, interesting information may be found in other government agencies, around senior politicians, in the military (which is generally much less secretive than intelligence agencies), in companies providing technical support and equipment and even in allied countries. It pays to draw a matrix of the information you would like and all the possible places it could be located.

9.     I never telephone a potential source the first time, as it is too hard to establish trust and not scare them off. Even getting an introduction through a mutual friend may feel too insecure. After researching the person, I usually visit their home – turning up on their doorstep – and introduce myself and explain what I am trying to achieve. The key is establishing trust (and being worthy of it). These approaches have usually worked.

10. Secrecy is a necessary part of intelligence research. Intelligence staff are given stern security “indoctrinations” and are not allowed to talk about work even to their families. They risk serious trouble if caught talking to you. So, right from the start, contact must be made carefully. The person must be sure that their identity will be protected for the rest of your life. Most ordinary people are hopeless at keeping secrets (which is a mostly good thing), so it’s essential to keep secrets to the absolutely minimum number of people.

11.            Knowing names of many intelligence staff helped me in an unexpected way. Insiders who might have been too scared to be the first person to spill the beans, found it easier to talk when I knew the names and could talk about their work mates. They felt much more comfortable when they were talking to someone who knew their world and were just “adding” to my knowledge rather than being the first or primary source.

12. Interview techniques – insiders will usually have stories on their minds they are keen to tell, but getting most information takes careful interviewing. Because you probably don’t know what there is to find out when you start, the key is asking a wide range of detailed questions (eg. on equipment, targets, organisation structures, personalities, regulations, manuals, links with foreign agencies, intelligence successes, things that went wrong, the layout of facilities…). The key is asking the right questions – and detailed questions can be a trigger for your source to remember other things. It is on the second or third interview, after reading over your interview notes, that you might strike upon the crucial questions and get the most valuable information.

13. Reading other publications on the subject can help suggest lines of questioning. Note that all western intelligence agencies adopt very similar procedures and techniques, and lots of training, manuals and operations are shared between them. So revelations about one agency are a guide to what is likely in the one you are studying. I recommend my book Secret Power (available from www.barnesandnoble.com).

14. Since most insiders cannot be quoted by name, and documentary evidence is rare, it is difficult to give credibility to inside information. How do we prove to sceptics that it is correct (especially on a subject where lots of silly stories fly around)? My.solution was to gather such a wealth of detailed information about the workings of intelligence agencies that the revelations had internal credibility.

15. I build trust with sources by telling them in advance that they retain control over all information that they give me. This means that I take drafts to them to check that they are comfortable with what I used and that they cannot be recognised as the source. I remove information if they ask and are the only source. This checking pays off for me too as they often spot errors and add more information. This is how I first heard of Echelon!

16. When publishing, put yourself in the mind of the agency security officer, who studies the dates your various pieces of information cover and which sections it could have come from and tries to narrow down suspects who may have talked. Mix up information from varied sources and omit details that point to just a few people.

17. Don’t underestimate field work, and don’t over-estimate security. Carefully studying intelligence facilities, the network of facilities in different countries and changes over time can produce valuable information. For instance, you can often see the direction that listening antennae are pointing and watch changes to intelligence facilities over time that match developments in telecommunications networks.

18. Don’t assume that security cannot be bypassed. Very secret information calls for unconventional research methods. Also don’t be fearful: there is far more personal risk from exposing, for instance, a rough, small-time criminal than from probing intelligence services.

19. The obscurity of the issue means that there are numerous scattered sources that have never been put together. Workers in technology companies, university departments and the military all have gossip and maybe know people you could talk to. Our job is to ask around and gather the pieces. Clues, like a memorable tiny detail I once noticed in our Army News, can lead to whole new areas of discovery.

20. Technical advice, for instance from contacts in the IT and communications world, can explain the communications systems which the spies are targeting and help you piece the story together.

Investigative Journalism Conference, Copenhagen, 26-29 April 2001.

Tips for Investigating Public Relations

Nicky Hager, New Zealand    0064 4 3845074, nicky@paradise.net.nz

1.     Understanding Public Relations is at the heart of understanding what is going on in many issues – and uncovering the PR tactics at work behind the news is crucial for good journalism. The best book for learning to recognise PR manipulation is John Stauber and Sheldon Rampton’s Toxic Sludge is Good for You: Lies Damn Lies and the Public Relations Industry, Common Courage Press, 1995.

2.     A lot of public relations reporting is primarily intelligent and sceptical analysis of news and issues. Also PR staff are often happy to pass on gossip about their competitors in other PR companies. But because public relations is inherently secretive, inside sources are crucial for gathering big stories.

3.     Never assume that companies are homogeneous, where everyone thinks alike and blindly supports everything the company does. Most organisations contain a mixture of people, including people concerned about wrongdoing and ethics who willing to act in the public interest.

4.     Sources may be senior or junior staff. Senior staff often treat lower paid workers as if they are invisible, or blind and stupid – but they may well know exactly what is going on and where the files are kept. The most successful way to find people is by word of mouth. Most of my inside sources covering many subjects are people about whom some friend of a friend told me. The key is to start looking.

5.     More specific leads can come from someone you know or get to know elsewhere in the same profession (eg. in another PR company), government staff and journalists who have contact with the PR people or other people involved in the issues being worked on (eg. other companies, scientists and so on). They may well know about someone who recently left the very place you are interested in.

6.     Remember that the particular classified information you are seeking is usually located in several different places, not just the obvious ones, and that some of these may be more accessible than others. Possibilities include a range of different sections within a company, outside consultants or institutions doing related contract work (eg research), other companies providing services (eg market research, publishing), other organisations allied to the main PR client and former employees. Imagine different types of interesting information and write a list of where each type might be located.

7.     The first thing I try to get when studying an organisation is an internal phone directory or staff list, providing a window into the organisation and showing which staff work on what (even better is collecting a series of staff lists covering many years so that you can see staff come and go).

8.     Retired senior politicians, government officials and businesspeople – who might not talk to us while in their jobs – are often very quickly forgotten by their old colleagues once they cease to be powerful and useful and are pleased to be interviewed about their experiences and insights. Following changes of government and ‘restructuring’ in companies and organisations is a good time to find such people.

9.     Great care is needed when approaching potential sources. It is their careers at risk and the first priority must be protecting them. If it is possible that someone may become a source, it is essential that right from the start all contacts with them are private and untraceable. Otherwise, when you come to want to use information, the link to that person may already be too obvious.

10. We should assume people want to help. While refusals do not feel good, the key to getting information is being brave enough to ask. It is, of course, worth finding out about people before approaching them to check they will not be offended and the approach pointless.

11. A good start for understanding the PR landscape (such as which companies are working on what) is company websites, PR industry publications (in the US, the monthly O'Dwyer's PR Services Report and PR Week), obtaining copies of the company profiles provided to potential clients and – especially – looking at the work of specialist PR watchdogs (eg US publications PR Watch journal and associated website www.prwatch.org; and the Netherlands-based news group Pandora, www.xs4all.nl/~evel/pandora and news archive www.oudenaarden.nl/lists/pandora/).

12. The best starting point for any new investigation is reading through all the easily available public information. Generally, if you have not done the unsecret slog of getting to know a subject from the open sources, you are unable to notice the good stuff when you find it – and, more to the point, you don’t know what to look for. Work out questions you’d like to answer and theories you’d like to test.

13. When You’re on to a story, all sorts of non-secret sources help to fill it out: annual reports, all manner of official reports, parliamentary questions and records, news searches, official websites and industry and professional magazines. I regard these boring looking sources – which often almost no one reads or even knows exist – as researcher goldmines. These sources can be supplemented by interviewing specialists (business people, government officials etc) on the record.

14. Wherever possible, we should start with original documents (not other people’s articles or quotations from them), as the secondary sources can miss interesting clues or even get things wrong. With articles or books, often the most valuable part is the footnotes at the end. They may point you to exactly the source you need.

15. A good way to save time is to ask around to find researchers, public interest groups or academics who know the topic you are investigating and who can recommend good sources to which you can go directly. Two or three phone calls are often all it takes to locate someone who can help you on the way to the information you are seeking. They might also point to important angles and key questions.

16. Despite the convenience, don’t assume that you only need to look on the Internet. It is a wonderful tool (for instance, searching for basic information about individuals, companies and organisations) and provides unexpected clues, but it can also waste heaps of time in aimless search. Most information sources on many topics are not on the web. One reason is that the Internet usually only has very recent information (say, 2-3 years or less): older sources have never been placed on-line or have already been taken off again.

17. Web pages - if you find something useful on a website make sure you download a copy for later reference. It is common for good information to be quickly removed from websites. Conversely, don't rely on websites to include, for example, all media releases. It is common for companies to issue media releases on major incidents but never to load them onto their website.

18. Often specialist libraries and the files of specialist organisations are more useful. Many companies, government departments, research institutes and public interest groups have their own libraries. A day reading old files in the national archives can likewise be productive. No matter what the institution is, librarians are the researcher’s friends.

19. One excellent source of information is PR industry conference papers and even better attending the conferences. Often the most revealing comments are made in response to questions and you can get a better understanding of key individual’s personalities. Above all access for interviews, without minders present, is much much easier inside a conference.

20. A key task is encouraging editors to recognise PR companies, strategies and activities as an interesting and important area of news reporting. There are still very few journalists who report on or investigate PR activities and there are almost none, outside PR industry publications, who specialise in it.