South Africa: Derailing the Gravy Train — Controlling Corruption
| Pages | 364-372 |
| Date | 01 February 1997 |
| Published date | 01 February 1997 |
| DOI | https://doi.org/10.1108/eb025808 |
| Author | Lala Camerer |
| Subject Matter | Accounting & finance |
Journal of Financial Crime — Vol. 4 No. 4 — International
South Africa: Derailing the Gravy Train —
Controlling Corruption
Lala Camerer
Corruption, broadly defined as 'the abuse of public
power for private gain' is extremely harmful to any
community. It threatens economic growth, social
development, consolidation of democracy and the
national morale. Politically, it creates situations of
potential instability by destroying trust and confi-
dence, for when an administration loses its credi-
bility a climate for instability, unrest and general
lawlessness is created. Economically, corruption
stifles private initiative and enterprise, and the
huge kickbacks and commissions demanded may
act as disincentives to investment whether by
foreign or local entrepreneurs.1 Corruption often
goes hand in hand with other criminal practices,
for example money laundering, drug trafficking
and organised crime, which may threaten a legiti-
mate economy. Corruption thus negatively impacts
on practices of productivity and performance as
well as efforts to bring about recovery and
development.
Interest in combating corruption concerns not
only public institutions but also private sector
organisations. There is a social concern that mas-
sive fraud in the private sector can jeopardise eco-
nomic and political institutions.2 As such, the
private sector has an immense interest in address-
ing corruption, which not only increases the costs
and hinders competitiveness of companies, but can
undermine the market economy system. Business
must be a part of the solution so as not to be
considered a major cause of the problem.3
Whereas in the past only developing countries
were believed to be plagued by corruption,
recently developed/industrialised countries have
also come under the spotlight.4 Corruption may,
however, be particularly harmful for developing
countries where there are more opportunities for
corruption and less resources, in terms of available
human resources with experience in audit, finan-
cial analysis and fraud investigation, immediately
able to fight it. While developing countries are
struggling to cope with the institutionalisation of
certain corrupt practices, it has been argued that in
developing economics there is a window of oppor-
tunity to set up anti-corruption systems and design
new public structures with anti-corruption prin-
ciples in mind.5 Some of these issues may find
resonance in South Africa, an economy delicately
balanced between the developed and developing
world.
All over the world national governments as well
as international organisations are creating anti-
corruption institutions with substantial resources
to tackle the problem of corruption and fraud in
both the public and the private sector.6 This paper
discusses the control of corruption in South Africa,
Page 364
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