Transparency Update: Anti-Corruption Measures in Brazil and Chile

The presidents of Brazil and Chile proposed anti-corruption measures this month in response to scandals that hit close to home. Brazilian President Dilma Rousseff submitted bills to Congress in the wake of mass opposition protests, during which demonstrators spoke out about the Petrobras corruption scandal, a bribery scheme involving the state-run oil company. In Chile, a series of corruption accusations—one involving influence-peddling and the president’s own son—led President Michelle Bachelet to call for greater transparency of officials’ assets.

According to Transparency International’s 2014 Corruption Perceptions Index—which measures perceived public-sector corruption around the globe—Chile and Brazil ranked 21 and 69, respectively, out of 174 countries. In the Americas, Brazil fared better than neighbors like Peru (85) and Venezuela (161), but ranked lower than Uruguay (also at 21) and Costa Rica (47). Plus, a March 22 Datafolha survey found that eight in 10 Brazilians believe the president knew about the Petrobras scandal, which took place when she was chairwoman of the company.

The perceptions ranking shows Chile as one of the least corrupt countries in the hemisphere, behind just five other countries. However, a Cadem poll released this week showed that 70 percent of Chileans believe there is “a lot” of government corruption.

Brazil: Proposing New Ways to Prevent Corruption

On March 15, large-scale opposition protests took place throughout Brazil, drawing hundreds of thousands. Many spoke out against the administration, particularly the ongoing Petrobras corruption scandal, and some protestors called for the president’s impeachment.

Known as the petrolão, or Big Oil case, the scandal—the largest known in Brazilian history—revealed suspicious payments worth up to $3.7 billion. Investigators found that construction companies paid large bribes to Petrobras in exchange for contracts.

Three days later, Rousseff announced a series of measures to fight corruption. “We are a government that does not tolerate corruption, and we are committed to and have the obligation to address impunity that fuels corruption,” Rousseff said.

First, she signed a decree to implement an anti-bribery law that increases fines for companies accused of fraudulent practices. Then she unveiled a bill that would criminalize slush funds, known as caixa 2, used by political parties to finance their campaigns, as well as imposing jail sentences for electoral financing fraud. Other proposed legislation would speed up the seizure of assets from those convicted of corruption. Rousseff also created a working group to find ways to speed up judicial proceedings involving public-sector corruption.

Another key bill would make the country’s clean-record law apply to public servants in the executive, legislative, and judicial branches of government. Currently, the legislation covers the president, governors, senators, and federal and state representatives. The law bans candidates from running for public office for eight years if they have been convicted of a serious crime, lost their political positions due to corruption, or resigned to avoid impeachment. Under the proposed expansion, public servants would receive the same temporary ban from working in the government if they have been investigated or charged with corrupt practices. Nearly one hundred thousand federal public servants alone would be included in the expansion.

The bills now head to Congress for consideration in the Chamber of Deputies.

Chile: Lifting the Veil on Public Officials’ Wealth

On March 19, Bachelet announced a series of measures in the wake of several corruption scandals, including several cases at private companies and one involving the president’s own family.

One case that broke last year involved a company laundering money and illegally financing a right-leaning political party, also ensnaring a former mining minster. Then, last month, the Bachelet’s son resigned from his government post after accusations of influence-peddling, since his wife allegedly received a fast and large loan from a private-sector bank for a land deal.

The president signed a measure that requires public-sector officials to declare their holdings, assets, and bank account sizes by April 30, and then once every year going forward. It also applies to those who have contracts with ministries, local governments, or government-run foundations. Once officials submit the information, it will be published in an online database available to the public.

“Solutions must be at the institutional level to keep our democracy strong,” said Bachelet.

Bachelet also sent a constitutional amendment bill to Congress that would require former presidents to declare their wealth. The president said she would be the first president ever to reveal this type of information.