Brazil's chief corruption watchdog abruptly resigned on the eve of the UN's International Anti-Corruption Day Tuesday.
It's no coincidence that comptroller general Jorge Hage Sobrinho, 76, the veteran official responsible for rooting out public corruption in the country, chose this time to pack it in. A person half his age would have pleaded overwork and exhaustion long ago from coping with a wave of scandals involving money-laundering, bribery and huge kickbacks that have allegedly reached the senior ranks of government and political organizations.
Unfortunately, Brazil's long and impressive record of malfeasance is no anomaly in a world where corrupt practices are too often the norm, rather than the exception.
Last week, the Organization for Economic Co-operation and Development issued a damning report on bribery that shows just how wide and deep the tentacles of corruption extend around the world – across developed and emerging markets alike.
It should come as no surprise that the bulk of illicit payments are being funnelled through agents or corporate vehicles set up for the purpose, in exchange for public procurement deals. But after reviewing data from 427 foreign bribery cases over the past 15 years, OECD analysts have reached other conclusions that ought to set off alarm bells among some members. That includes the U.S. and Canadian governments, which have made much of their determination to stamp out foreign bribery by domestic corporations.
"Corporate leadership is involved, or at least aware, of the practice of foreign bribery in most cases," the report says. This debunks the notion, warmly embraced by embattled senior executives everywhere, that overzealous "rogue employees" are responsible for sullying their companies' sterling reputations.
The OECD reckons that bribes averaged nearly 11 per cent of the total value of the contracts involved, and almost 35 per cent of the profits. The average size of the payouts was close to $14-million (U.S.). So there is a steep economic cost.
That's something Brazilians are all too well aware of after years of scandalous dealings that siphoned huge sums from public coffers and ratcheted up the cost of badly needed infrastructure. A 2010 study pegged the cost of corruption at between 1.4 and 2.3 per cent of GDP. And if the latest examples are anything to go by, that could be a tad on the low side.
The most notorious case – labelled Operation Car Wash in the local media – focuses on illicit dealings among a handful of former officials at state-oil giant Petrobras, influential construction executives and various political players and organizations.
Fat bribes were allegedly paid in return for lucrative contracts for Petrobras-related projects. Part of the haul flowed into President Dilma Rousseff's Workers' Party and its congressional allies, according to a former Petrobras director who alleges that dozens of politicians were in on the action.
For now, Brazilian prosecutors are set to indict 11 executives from half a dozen construction and engineering outfits over bribes running into the billions. But the judge in the case wants investigators to examine other major infrastructure projects for similar transgressions.
They are bound to find plenty of dirt under the proverbial rug. Corruption still seems to be the preferred operating method in a large swath of the world. And harsher penalties will only help if investigators and prosecutors have enough resources to pursue complex international cases that can take more than seven years to reach a courtroom.
Mr. Hage made that point Tuesday, observing that the government has cut his budget, making it difficult to cover his office's basic utility bills.
"Historically, the comptroller already had a small budget," he told reporters in Brasilia. "We represent a tiny part of the federal budget, especially compared with what we avoid in terms of waste and misappropriations."
It's good that he's not going away quite as quietly as the government undoubtedly would have preferred.