- Local study report finds nexus between human rights & politically-exposed perpetrators
- Proposes policy interventions to address impunity
Since the onset of the economic crisis in Sri Lanka in 2022, the demands for accountability and transparency have amplified. Corruption, economic crimes, and economic loss due to governance-related and administrative inefficiencies are recurring topics over the past decades despite successive governments failing to achieve long-lasting and meaningful measures towards accountability.
There has also been a discourse both within the present governance structures and beyond to address corruption. However, the issue of addressing economic crimes remains elusive, particularly with little material success in holding perpetrators of economic crimes accountable. It also raises questions regarding the capability of the Sri Lankan socio-political, legal and governance structures to address economic crimes in Sri Lanka.
This situation was explained in a report titled ‘Advocacy Report on Understanding Interconnections Between Human Rights and Economic Crimes in Sri Lanka: Exploring Issues and Potential Ways Forward’ issued this week by the local think-tank, the Centre for Policy Alternatives. The report was based on a recent study.
It added: “In Sri Lanka, economic crimes perpetrated by politically-exposed persons have received critical attention at present, where there have been discussions on plausible interventions to address the culture of impunity and the human rights related implications of economic crimes. Since the notion of economic crimes suffers from an inherent conceptual confusion, there are a myriad of policy prescriptions and interventions to address economic crimes.”
Findings of the research
Regarding the definition of ‘economic crime’, the report said: “In criminology, economic crimes are identified as white collar crimes, committed by a person of respectability and high social status”. According to the United Kingdom Economic Crime Plan Two (2023-2026), economic crimes are defined as “a broad category of activity including money, finance or assets, the purpose of which is to unlawfully obtain a profit or advantage for the perpetrator or to cause loss to others”. Such economic crimes pose critical harm to society and individuals as it inflicts systemic threats to peoples’ ways of life. In the Dictionary on Corruption, ‘Economic Crime’ (also known as financial crime) is defined by Robert Barrington, Elizabeth David-Barrett and Rebecca Dobson Phillips, as: “Illegal activity that involves money, assets, or finance.” Further, it is stated that corruption “can be a form of economic crime when the benefits or losses that result from their commission are financial”.
Findings of the research pointed out structural, legal and socio-political challenges in addressing economic crimes in Sri Lanka, regarding which the report said: “It is pertinent to note that these challenges are mutually interrelated. Further, the challenges discussed in this study are largely a selection of issues highlighted by experts during the key informant interviews and the roundtable discussion. These challenges are an assortment of issues that could potentially drive further dialogue and research on the deep-rooted challenges underlying the impunity for economic crimes and human rights violations in Sri Lanka.”
Under structural challenges, issues such as vested interests in institutions, concerns regarding the independence and integrity of institutional structures, deliberate attempts aimed at dismantling systems of accountability, past challenges faced in setting up a specialised investigative division for financial crimes, the lack of technical and technological specialisation to investigate economic crimes, a mismatch between existing skills of domestic investigators and the international financial crimes investigations sector, concerns regarding the wastage of time and resources spent on training investigative officers in the past, vetting the integrity of recruits for investigations, the lack of resources, the lack of specialised judicial training, challenges in implementing new systems to address economic crimes, and the practical challenges in trying economic crimes cases in courts were pointed out.
The report pointed out several issues as legal challenges as well. Among them were issues regarding assets related legal frameworks, procurement-related violations and the requirement of open procurement platforms, the manipulation of tender procedures, practical concerns regarding whistleblower protection, concerns regarding the implementation of the election campaign financing law, and other concerns on present and proposed legal frameworks.
With regard to socio-political challenges, the report’s findings identified as challenges the lack of demands on political accountability from elected officials, geo-political issues, and the compartmentalised approach to human rights and accountability.
Potential structural interventions
The report said that in Sri Lanka, as a country in the Global South, transitioning from a prolonged period of conflict, authoritarianism, and chronic economic crisis, the challenge of addressing economic crimes is much more than a conventional matter of addressing ‘white collar crimes’ in Sri Lanka.
In this context, it added, there are broader issue areas in the realm of economic crimes which include human rights implications caused by unlawful activities perpetrated by politically exposed persons who can also take the form of private businesses, international corporations, and professional bodies. Thus, it said, economic crimes perpetrated by these entities do not necessarily take a conventional form, and could include other forms of economic crimes such as land grabbing, socio-economic marginalisation as well as the violation of the rights to access to natural resources and the human right to a clean and healthy environment.
The report explained: “The point of departure in the present study was the need to broadly examine the intersections of economic crimes and human rights violations by unveiling different systems of impunity. It was only an entry point into a much larger debate on economic crimes as system crimes requiring multi-stakeholder interventions at broader structural, legal, and socio-political levels. The present moment in Sri Lanka calls for critical action at all these levels to meaningfully address economic crimes in the country. Whilst there are multiple reports extensively discussing the much-needed reforms in the path to recovery, successful efforts towards addressing economic crimes should now also delve into the broader issue areas of economic crimes in Sri Lanka considering new debates and conceptions.”
In doing so, the report said, it is vital to not only consider the human rights implications of economic crimes, but also the direct human rights abuse caused by perpetrators of economic crimes who also deliberately entrench systems of impunity against accountability.
Therefore, the report recommended a number of interventions at various levels.
At the investigative level, the report recommended establishing a powerful and independent investigative arm with the capacity to investigate economic crimes, and continued efforts to build the technical, technological, and other capacities of investigators.
Concerning the prosecution level, it recommended establishing a specialised and independent prosecutor’s office addressing economic crimes, and providing the opportunities to specialise in economic crimes cases for current prosecutors.
At the adjudication level, investing in continuous efforts for the capacity building of judges, providing the opportunity to specialise in economic crimes cases, assigning economic crimes cases to judges who have acquired specialisation to address economic crimes using dedicated courts, and enforcing novel concepts available to mitigate the time were recommended.
As far as public sector reforms are concerned, the report pointed out the importance of continuous institutional capacity building to bridge the mismatch between the skills required to address complex, sophisticated, and fast evolving economic crimes. In addition, it recommended paying attention to adequate resourcing to address issues such as asset tracing and the proceeds of crime cases, reforms within the public sector to overcome challenges of State capture, and enhancing institutional coordination in addressing economic crimes cases.
Increasing visibility on investigations and other useful tools was another aspect that received the report’s attention. In this regard, the report recommended ensuring that updated records of investigations be publicly available on a designated website in an accessible manner, adding that it is vital to raise public awareness of such tools.
Regarding private-public partnerships to enhance open and transparent governance, out of the box thinking was recommended to attract financial, banking, and other experts as well as young talent to investigations and prosecutions, which includes competitive salaries and incentives. Harnessing new technologies to facilitate electronic governance for transparency was another recommendation under the same topic.
Potential legal and socio-political interventions also received the report’s attention. Under the demands from political parties and election candidates, the report highlighted the key demands to party leaders, contesting candidates and other political elite to declare their stance and commitment to accountability for economic crimes, accountability for the economic crimes in the election manifesto context and the general election related discourse, the declaration on a commitment to prevent politically exposed persons from being protected against prosecution, and the declaration on a commitment of financing and institutional strengthening.
To raise voter awareness of the economic crisis related determination and to strengthen the public call for accountability, it was recommended to initiate post-judgement advocacy measures to promote political accountability amongst political parties and election candidates and advocacy around realistic expectations on addressing economic crimes.
With regard to the role of international institutions and foreign Governments, the continued monitoring of the effectiveness of legal reforms proposed in the International Monetary Fund package and to also support efforts at structural and legal initiatives to address accountability in Sri Lanka were recommended as potential interventions.