BWIRE: Bribery in the private sector is graft, not economic crime
- We need to finalise the regulations on the Bribery Act 2016 to allow tough provisions prohibiting bribes as a tax deductible item.
- So far suspects in corruption cases are being reported as economic crimes and not specifically bribery cases.
- The Government is doing its part, but where is the support from the business community and professional bodies?
The ongoing purge on corruption in Kenya now needs to extend to strengthen the legal framework that enhance business integrity, outside the public sector, and include the private sector.
We need to finalise the regulations on the Bribery Act 2016 to allow tough provisions prohibiting bribes as a tax deductible item.
So far suspects in corruption cases are being reported as economic crimes and not specifically bribery cases, which would have a different implication as the Bribery Act significantly expands the mandate of the EACC to focus on the private sector.
We are not sure how the code of ethics for business in Kenya that was spearheaded by apex business associations KAM, KEPSA and UN Global Compact Kenya is doing. The Government is doing its part, but where is the support from the business community and professional bodies?
Globally, the private sector is the supply side of corruption especially through receiving and making payments to gain advantage in business over others. Those in the leadership of the several private sectors must also be willing to lose their friends and partners that have been involved in corrupt business deal either with the Government or outside.
A recent survey by Transparency International Kenya entitled Business Integrity Country Report Agenda (Bica) for Kenya makes very relevant observations and recommendations, including calls for the private sector, civil society and Kenyans in general to join the collective effort to improve integrity and fight corruption in Kenya.
Government has done enough, and needs support. The May 2018 report notes that while the country has laws prohibiting bribery of public officials by the EACC and the ODPP, the Bribery Act 2016 which would have dealt with the private sector decisively, while prohibiting mildly, commercial bribery, no cases have been investigated or prosecuted so far.
The report notes that while the Proceeds of Crime and Anti Money Laundering Act (POCAMLA) 2009 contains provisions that prohibit laundering of proceeds of crime including concealment or disguise of property with knowledge that it was proceeds of crime.
While it also prohibits acquisition or use of property knowing that the property is the proceed of crime as well as association or participation in a conspiracy to facilitate, abet or counsel in the concealment or acquisition of proceeds of crime, the Act does not have prohibitions on the conversion or transfer of property, knowing that such property is the proceeds of crime, for the purpose of concealing or disguising the illicit origin of the property.
The assessment notes that while the Financial Reporting Centre hasn’t produced any annual report since its formation in 2012.
The Companies Act, 2015 requires only listed companies to have external audits according to internationally recognised standards and for these companies to publish their external audit reports annually yet a number of companies outside this bracket do business with Government.
The Companies Act, 2015 outlines penalties and sanctions for directors that fail to prepare annual financial statements as per the requirements.
Institutions in charge of enforcement such as the Central Bank of Kenya (CBK), the Capital Markets Authority (CMA) and ICPAK do not necessarily publish reports that show enforcement actions and decisions taken in individual cases, including accounting matters.
While the amended Companies Act, 2015 has provisions on beneficial ownership, it fails to provide penalties for willful misrepresentation of information on neither beneficial ownership nor failure to disclose nominees fronting directors or shareholders.
Victor Bwire works at the Media Council of Kenya as deputy CEO & Programmes Manager firstname.lastname@example.org
For Citizen TV updates
Join @citizentvke Telegram channel
Video Of The Day: | FIRST CLASS BETRAYAL | First class graduate lives on streets