Why civil actions against corruption?
| Published date | 08 May 2009 |
| DOI | https://doi.org/10.1108/13590790910951821 |
| Pages | 144-159 |
| Date | 08 May 2009 |
| Author | Simon N.M. Young |
| Subject Matter | Accounting & finance |
Why civil actions against
corruption?
Simon N.M. Young
Centre for Comparative and Public Law, Faculty of Law,
University of Hong Kong, Pokfulam, Hong Kong
Abstract
Purpose – The purpose of this paper is to identify and examine motivating factors for why public
and private actors initiate costly and risky civil actions to recover loss due to corruption in an era of
increasing multilateral consensus and cooperation against corruption and organised crime.
Design/methodology/approach – Research into recent global trends and types of civil lawsuits
against corruption is conducted. Several cases, particularly from Canada, Hong Kong, the USA and the
UK, are used to illustrate the attractions and difficulties of civil litigation. The implications of the
recent international treaties on corruption are analyzed. Qualitative findings are made on a range of
motivational factors that lie behind different types of civil actions against corruption.
Findings – The paper notes an apparent rise in interest in civil actions against corruption and
describes five types of actions brought by governments and companies. Civil actions are indicative of
the want of better alternatives to recovery. While recent anti-corruption treaties help to remove
barriers to civil actions, the treaties themselves cannot explain the increased interest in civil lawsuits.
Full explanation lies in the empowering effect of suing, the political significance of these lawsuits
particularly for a new regime suing to recover plundered property from the old regime, and the ease by
which a lawsuit can be launched.
Originality/value – This paper contributes to the literature in identifying types of civil actions
against corruption, the practical and political motivations behind civil actions, and the positive
relationship between international cooperation regimes and civil actions.
Keywords Bribery, Civillaw, Corruption, Internationalcooperation, International law
Paper type Research paper
1. Introduction
Modern criminal justice systems try to ensure that victims are compensated for injurie s
and losses suffered at the hands of the defendant[1]. If the victim initiates a civil action
to recover losses, this is usually a sign that there may have been a failing in the
criminal justice system. Sometimes, it is because the wrongdoers cannot be prosecuted
(whether due to a stay of proceeding, death or disappearance); other times, the
defendant is acquitted due to an insufficiently strong case for the prosecution.
An impecunious victim unable to sue in these circumstances goes uncompensated,
unless there is state-funded criminal injuries compensation.
Does the same apply to victims of corruption? The crime of corruption is unique in
many ways. The gains and losses involved can be massive. The state or government
The current issue and full text archive of this journal is available at
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This paper is based on a presentation that was delivered at the 26th International Symposium on
Economic Crime, Jesus College, Cambridge University.
The work described in this paper was fully supported by a grant from the Central Policy Unit
of the Government of the Hong Kong Special Administrative Region and the Research Grants
Council of the Hong Kong Sp ecial Administrativ e Region, China (Project No. HKU
7023-PPR-20051). The author wishes to thank Peter Chau for his excellent research assistance.
JFC
16,2
144
Journal of Financial Crime
Vol. 16 No. 2, 2009
pp. 144-159
qEmerald Group Publishing Limited
1359-0790
DOI 10.1108/13590790910951821
is often the victim. The proceeds of corruption, if traceable, are often in another
jurisdiction thereby complicating recovery. The criminal justice system may be
working fine, in that it has convicted and punished the wrongdoer, yet the victim may
still need to sue locally or abroad to recover fully the corruption proceeds.
Civil actions against corruption are indicative not necessarily of a failing of
the criminal justice system but of the absence of a better alternative to recovery (such
as by confiscation and international cooperation). Even with better alternatives to
recovery, civil actions will still continue for a number of reasons including the ease by
which they can be launched, the empowering effects of civil actions, the political
implications of such actions, and the facilitating role of international cooperation. Civil
actions will also proliferate if states enact laws that provide for more effective civil
actions, fewer barriers to litigation and a wider array of plaintiffs.
This paper develops and supports the above thesis by reference to relevant cases,
treaties and domestic laws around the world. It seeks to understand the multitude of
factors that affect why civil actions against corruption are launched or not launched.
The meaning and significance of these civil actions are discussed in the context of
multilateral treaties and initiatives against corruption. The paper begins by noting an
apparent global rise in civil actions of this kind and in literature promoting such
actions. Five types of civil actions are identified and discussed. Next, the international
law context is examined to assess the extent to which it has or will contribute to the
phenomenon of civil actions. Finally, an examination of the motivating factors for civil
actions leads to conclusions about their contemporary significance.
2. Rise of civil actions against corruption
There is a perception thatcivil actions against corruption have beenon the rise in recent
times.Cases appear regularlyin the news headlines from allparts of the world. The USA is
no stranger to corruption litigation, yet even there,cases seem to be on the rise. In recent
literature, lawyers, academics, students, policy makers and insurance companies have
predicted and advocated more civil lawsuits in the fight againstcorruption.
2.1 Classification of civil actions
Recent cases can be classified in one of the five categories. Regime change lawsuits are
generally cases of grand corruption. The new regime sues those who were in power
before to recover embezzled state property or other property that the new regime now
claims. The 2007 Indonesian lawsuits against former President Suharto and his son
Tommy are a recent example (Deutsche Presse-Agentur, 2007; Aljazeera, 2007; BBC
News, 2007). The US$1.5 billion civil lawsuit alleged that the former Indonesian
president appropriated US$440 million from a charity scholarship fund. The suit
against the son alleged that the state suffered US$55 million in damages as a result of
the defendant’s involvement in a corrupt land exchange scheme. Both cases were
necessitated by failed criminal proceedings. Other recent examples of regime change
lawsuits are two English cases, one involving the former (and deceased) Zambian
President Chilubu[2], and the other now failed lawsuit against Asif Ali Zardari,
Pakistan’s newly elected President following the assassination of his wife Benazir
Bhutto (former Prime Minister of Pakistan)[3]. Law suits together with criminal
investigations also loom against former leaders and their family members in Thailand
and Taiwan.
Civil actions
against
corruption
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