Welcome to the fifth Asian Crime Century briefing of 2023. Corruption is in the spotlight this week as Transparency International announced the 2022 rankings of the Corruption Perception Index, reporting that there is progress by several countries in Asia against petty corruption but grand corruption remains common and the overall situation has barely improved.
Singapore stands out as being perceived as the least corrupt country in Asia, ranking fifth (globally) on the TI index. The frequent strong action by the Singapore authorities against any criminal corruption cases illustrates the value of a zero tolerance approach to corruption.
The significant decliners in the index identified by TI are Malaysia (ranked 47), Pakistan (ranked 27), and the Philippines (ranked 33). Malaysia is reported by TI to suffer from “grand corruption”, such as the 1MDB case which was one of the largest corruption cases in the world involving the misappropriation of US$4.5 billion, the imprisonment of former Prime Minister Najib Razak, and charges against investment bank Goldman Sachs under the US Foreign Corrupt Practices Act leading to a fine of US$2.9 billion.
TI raises concerns regarding India that the government limits the public’s ability to respond to issues, highlighting the protests in 2011 that led to anti-corruption reforms but since then there have been increasingly severe restrictions on peaceful protest in the country which limit scrutiny of possible corruption. The perception of corruption in India comes as the Adani Group has lost over US$100 billion in share value following allegations of fraud.
Corruption remains a major challenge to business in Asia and it is essential that not only do governments in the region do their utmost to prosecute cases but also allow civil society groups to expose suspected corruption, especially “grand corruption”. The latter remains a challenge for many governments in the region.
China
Another criminal trial in Macau into a casino junket operator has heard details of how the Tak Chun Group organised ‘proxy bets’ from inside casinos on behalf of customers located overseas. The head of Tak Chun, Mr. Levo Chan Weng Lin, and eight other defendants, are charged with illegal gambling, being members of a criminal organisation, defrauding the Macau Government as well as the licensed casino operators, and money laundering. Tak Chun is alleged to have provide a mobile phone app for customers who could play live baccarat online, hosted at Manila casino resorts Solaire Resort, City of Dreams, and Okada Manila. The case illustrates the extensive transnational illegal gambling and money laundering by Macau casino junkets that has been growing for the several decades.
India
The publication of a report from the Hindenburg Group alleging fraud by the Adani Group has not only led to the loss of over US$100 billion in share process of listed companies in the group, but are now raising concerns of market contagion in India due to credit warnings. The Adani Group has denied the allegations of fraud, but this has not stopped the huge fall in share prices. The Ministry of Corporate Affairs in India has also started a review of Adani Group financial statements and regulatory submissions made in the past several years, indicating that the worst could be still to come for the company and the controlling Adani family.
In response, the Adani Group stated that “This is not merely an unwarranted attack on any specific company but a calculated attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India.” The Indian authorities may not see the issue this way if they do find evidence of fraud in Adani Group accounting.
Indonesia
Indonesia fell from 38 to 34 in the TI Corruption Prevention Index, possibly showing the concern of business actors about the government’s commitment and political will to support democratic pillars and anti-corruption measures.
An indication of the problems in Indonesia was shown in a corruption case against a trade ministry official, a prominent economist, and three palm oil executives who on 4 January were convicted of charges relating to breaching a requirement to ensure that 20% of palm oil was allocated to the domestic market, an important national issue due to a shortage of cooking oil despite Indonesia being one of the world’s major producers. Three companies had continued to sell oil overseas by securing export permits from the Director General of Trade at the time. Those involved in the private-public sector corruption were sentenced to one year to 18 months’ imprisonment, far less than the 7 to 12 years sought by the prosecution.
Japan
The spread of Chinese criminal gangs in Asia is highlighted by an excellent article by Martina Baradel on the Yakuza battle Chinese gangs for control of Japan’s criminal underworld. She reports increasing concern in Japan that the Chinese Dragons and other criminal groups that have moved from China in the past 30 years are increasingly active in criminality that used to be controlled by the yakuza. A leading gang, ‘The Chinese Dragons’, originated in the 1980s in Tokyo as a means for its members to protect themselves from discrimination against people of Chinese descent. The Chinese Dragons are hence very different from yakuza, which are local Japanese criminal groups with a semi-legal status and offices in some cities. The decline in yakuza membership and the increased enforcement action against them by the police raise the prospect of further influence by non-Japanese criminal groups, although as Ms. Baradel points out this perception may be more related to growing social anxiety and anti-foreigner sentiment in Japan.
Despite the fact that Japan has been regarded as one of the most safe countries in the world for decades, reported crime increased in 2022 for the first time in 20 years. There were a total of 601,389 criminal incidents reported last year, up 5.9% from 2021, although that year was the lowest level since World War Two. Cases of domestic violence and suspected child abuse were the highest ever recorded. Although the increase in criminal cases is from a low base the prior year, many people in Japan are concerned that public safety has declined in the past decade.
South Korea
A former South Korean Minister of Justice was sentenced to two years imprisonment after he was found guilty of creating fake credentials to help his children get into prestigious schools. Cho Kuk was also found guilty of abusing his powers whilst serving as a senior aide to the president by blocking an investigation into a former Financial Services Commission official who was later arrested for taking bribes from business people.
Malaysia
Another five Malaysians who were tricked by job scammers in Cambodia have return home after being rescued by the authorities in Cambodia. The Malaysian government stated that they have received 262 reports involving 336 Malaysians who have been tricked by job scams and were stranded in Cambodia, Laos and Myanmar, with 218 victims rescued so far and another 118 stranded overseas. The victims are usually tricked into believing that they are going to work in well paid jobs, but are in fact trafficked, held captive and many forced to work in casinos.
Pakistan
Over 100 people were killed and more than 225 injured by a suicide bomb attack on a mosque in Peshawar. Most of those killed were police officers, with the mosque located close to the headquarters of the provincial police force and a counterterrorism department. A splinter group of Tehreek-e-Taliban Pakistan (TTP) has claimed responsibility for the attack, reportedly in retaliation for the killing of their former leader in Afghanistan last year that was attributed to Pakistani security forces. The TTP ended a cease fire with the Pakistan government last November and intelligence reports suggest that the group has planned a wave of attacks in Peshawar and the wider Khyber Pakhtunkhwa province. The continued violence in Pakistan comes as the country faces a severe economic crisis.
Philippines
The ‘Luffy’ Japanese robbery gang suspects are reportedly being held in ‘VIP Rooms’ at Philippine detention Center, with access to smartphones and luxury items. The focus of the case has switched to the Philippines from Japan with questions being asked regarding why the Japanese allegedly criminals responsible for remotely organising the robberies in Japan could do so from a detention centre in the Philippines. According to news media reports, Japanese suspects Yuki Watanabe (believed to be ‘Luffy’) and Kiyoto Imamura occupied a “VIP room” with a shower and a toilet, had access to air conditioners, fans, multiple smartphones, and often ordered food deliveries because they disliked the simple meals provided at the facility.
The Philippines authorities announced on Saturday 4 February that they had dismissed all 36 officials, including the director, at the Bicutan detention center in Manila, which comes after smartphones, computers, Wi-Fi routers and other communication devices were seized in a search conducted last week.
Singapore
Singapore is proudly reporting that the country ranked least corrupt Asian country and fifth overall of 180 countries and territories, according to the latest Transparency International Corruption Perception Index. TI praised the Corrupt Practices Investigation Bureau (CPIB) in Singapore, calling it an excellent anti-corruption agency with international repute. However, TI also raised concerns that Singapore suffers from illicit financial flows across borders and needs more civic spaces to voice out against corruption publicly.