Better asset declaration could help Vietnam curb corruption

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Make "˜illicit enrichment' a criminal offense and launch independent investigations into senior government officials' asset declarations, a UN anti-corruption advisor says

Two women sit on the side of a street next to a pile of recyclable items in front of a poster advertising luxury apartments on a street in Hanoi. The exposure of several government officials' illicit fortunes has prompted concerns about Vietnam's efforts towards a transparent asset declaration process.

Pham My Hoa, a senior official at the Hanoi Department of Information and Communications, earned big money in 2012.

The director of the department's Center for Information and Communication Technology Transaction acquired three houses, a resort, 20,765 square meters of perennial plant gardens and two cars worth VND2 billion (US$95,600).

Her assets came to light after the asset declarations of agency staff were released a few weeks ago. The controversy has raged ever since.

Hoa's case, together with other cases in which government officials' illicit fortunes have been exposed, has prompted concerns over persistent challenges to Vietnam's efforts towards a transparent asset declaration system.

So far, there have been different explanations for Hoa's increased assets and no investigation has been announced.

To Van Dong, director of Hanoi Department of Information and Communications, said Hoa was appointed to be the center's director in February 2012.

Hoa declared that she has a house and a car in 2011, Nguoi Lao Dong (Laborer) newspaper quoted Dong as saying.

When asked about Hoa's 2012 asset declaration, she said it was "inheritance from ancestors," Dong said.

Meanwhile, Hoa told the paper that she had misunderstood the form and declared the three stories of a house as three houses. She also said the increased assets were sourced from her husband's private business.

Her husband, Nguyen Manh Quyen, is deputy director of the Hanoi Department of Planning and Investment.

Do Gia Thu, director of the Legal Department under the Government Inspectorate, said there were signs of dishonesty in Hoa's asset declaration and that her superiors should identify the assets' origins.

Hidden assets

Unlike Hoa who at least declared her increased assets, details other government officials' shady wealth have slipped out only accidentally.

In a recent case, Kon Tum Province authorities are investigating the origin of property stolen from the house of Dang Xuan Tho, director of Kon Tum's Finance Department. The property is worth hundreds of thousands of dollars in total.

The investigation was launched last month after Gia Lai police arrested four thieves who confessed to breaking into Tho's house in Gia Lai's Pleiku Town late last year.

The thieves said they had taken more than 2.3 kilograms of gold, jewelry, a laptop, a gaur horn and a stun gun worth a total VND3 billion (US$143,300).

Vietnam's annual income per capita is around $1,300.

Earlier, Tho's family had reported to local police that it was only a minor theft that involved little property.

Tho's wife, Tran Thi Xuan Lan, who is head of the human resource division at the Gia Lai Tax Department, reported to local police that the thieves had stolen 150 grams of gold from the house.

Nguyen Van Hoa, chief of the Kon Tum Party Committee's Inspection Committee, said authorities were checking Tho's yearly declaration of income and assets in order to track down the origin of the stolen property.

Unofficial sources

According to a recent study by the Government Inspectorate, many government officials earn income from "unofficial" sources.

Results from the 2012 study, undertaken with the cooperation of the World Bank, showed that the income of people with government rankings and power was on the increase thanks to "various sources."

Out of nearly 2,000 surveyed officials from ten cities and provinces and five central government units, 79 percent were found to have other income besides salaries and official bonuses.

The unofficial money included money leftover from projects, payments for attending meetings, gift money and others.

Among those earning extra money, more than 82 percent said those funds were less than half as much as their salaries while 11 percent said it was between 50-100 percent of their salary and the rest admitted to having earned up to five times more than their salaries.

"˜You are responsible'

In a recent move, government inspectors said they would seek approval from the Politburo, the Party's decision-making body, for a plan to better enforce the monitoring of government officials' assets.

Pham Trong Dat, director of the Government Inspectorate's Anti-Corruption Department, said there would be new regulations on asset declaration.

"If you buy a new car, house or land, you are responsible for explaining the source of the money spent on it," he said at a recent meeting on anti-corruption in Ho Chi Minh City.

He said there would be punitive measures against those who refuse to clarify all assets.

According to the Anti-Corruption Law, government officials required to declare assets include: deputy head of district-level agencies and higher positions, commune-level officials managing the state exchequer or having direct contact with residents in solving administrative procedures, and legislative candidates.

However, experts say the law's broad spectrum was a problem.

"There are simply too many public officials and civil servants required to submit applications. This makes the system unmanageable due to the large number of applications and the limited number of inspectors available to realistically verify that those declarations are accurate," said Jairo Acuña-Alfaro, anti-corruption policy advisor to the United Nations Development Program in Vietnam.

He said the work to be done was cultural as well as regulatory.

"Corruption in Vietnam is systemic, this implies a strong network of relationships and contacts at the place of work that makes it difficult for co-workers to denounce others," he told Vietweek.

Soren Davidsen, senior governance specialist from the World Bank in Vietnam, said while there are no perfect models for asset declarations, international experience shows that these systems work best when several major factors are in place.

"The number of officials required to declare must be kept selective and focused on the most corruption prone sectors and groups in order to keep it manageable," Davidsen said.

Verifications of declarations are necessary to affect the incentive framework of officials and organizations and to maintain credibility of the system, he said. Once verification has been undertaken, the effectiveness depends critically on the probability of sanctions if officials fail to declare or wrongfully declare and sanctions if wealth can not be attributed to official income, he added.

Finally, "public access and media scrutiny to asset declarations files have been found to result in lower corruption."

Hailing the Government Inspectorate's plan to be submitted to the Politburo as a good move, UNDP's Acuña-Alfaro called for more autonomy and independence to be given to investigative and prosecutorial agencies.

"Allow for a thorough and independent investigation of the accuracy of those declarations and provide the verifying agency with clearer and stronger mandates to prosecute and make "˜illicit enrichment' a criminal offense, as per article 20 of the UN Convention against Corruption."

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