ization is rolled out—to eliminate some rentseeking opportunities. Patronage is the making of appointments as part of a reciprocal exchange of favors among political or other interest groups. Patronage networks impede the emergence of an efficient, modern bureaucracy. They facilitate evasion, so they have high fiscal as well as social impacts. And they often extend to law enforcement agencies, leading to pervasive impunity. While there are no technical methods for dealing with patronage, it is possible to introduce alert mechanisms into customs systems to point out patronage patterns.
Grand (or criminal) corruption occurs when criminal interests pay or otherwise exert pressure to protect their illegal operations, such as drug trafficking. Often such corruption amounts to state capture by criminal networks. Assessing its impact is difficult, as family or tribal networks—sometimes intricate—collude in corrupt practices that allow large revenue leakage and the passage of illicit and hazardous goods (drugs in particular). The greatest costs of corruption to state and society are not the rents and bribes as such but the underlying distortions, revenue leakages and criminal activities that they
Designing a tool for mapping vulnerabilities to corruption and identifying mitigating actions: the governance accountability action plan for border management reform
Given the need for holistic, outcome based approaches to improving governance in customs and border management—and the landscape of corruption just described—how should interventions to improve governance in these areas be designed? Th is section outlines a possible approach. Like all attempts to find solutions, this one starts by identifying problems in relation to the desired outcome: better governance in border management. Considering the complexity of donor initiatives, a cost effective border management intervention must do four things: • Build on all existing activities. • Prepare for longer term solutions, such as an overhaul of legislation or institutions. • Optimize results for stakeholder ownership. • Provide quantifiable results that validate the roadmap for further reform. To design such an approach a methodology is required that assesses the overall governance situation and that identifies vulnerabilities as well as responsible actors. The setting of reform priorities then becomes possible through quantifying corresponding risk levels and determining governance dimensions. The GAAP for border management reform was designed to be less subjective than earlier assessments and to allow the effects of poor governance on border management reform implementation to B O R D E R M A N A G E M E N T M O D E R N I Z AT I O N
20 Integrity risk modeling in the border management context
Collusion occurs when a trader or agent evades all or part of a fiscal obligation and a customs officer receives a share in the unpaid amount. Leading to direct—often major—revenue leakage, collusion is largely a political and social problem. Yet it can be partly checked through simple but effective, real time alert mechanisms that bring suspicious transactions to the attention of a network of managers and auditors inside and outside the customs agency. Examples of such transactions include systematic valuation queries or waivers, the repeated processing of imports from the same importer by the same customs officer, and the like. Collusion at borders can be addressed through: • Checks and balances using external data (for example, data obtained automatically from across the border) to validate processing. • As much as possible, automatic capture of basic data that cannot be interfered with later. • Downstream control.
reveal and facilitate on a larger scale. Indeed, in fragile states grand corruption does not cause large fiscal leakages—rather, in more severe ways, it threatens the writ of the state. Grand corruption can be partly addressed through an overhaul of procedures, legislation, and institutional mandate with auditing tools to help detect corruption levels. Such an overhaul can be only partly effective, because the deep social and political roots of criminal networks undermine any attempt at overhauling systems—especially in fragile states and countries in conflict, where the rule of law is generally extremely weak.
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