Today, judicial corruption remains a significant concern to the United Nations, FATF, the Western Balkans of the European Union accession countries, developed, developing and the least developed countries.

Judicial corruption undermines a nation’s judicial system, violation of human rights and abuses the sovereignty conferred upon the judicial personnel such as the Police, Public Prosecutor and Judge.  For a Judge whether a magistrate, high court judge, supreme court judge or chief justice, the position in AML/CFT language, falls under the definition of a Politically Exposed Person (“PEP”).  See Chapter 7, Politically Exposed Person, First Edition, Money Laundering – A Handbook for CDD Compliance.  Therefore, judicial corruption refers to the corruption-related misconduct of judicial personnel, through receiving bribes, improper investigation of a crime, bias indictment, bais hearing and arguments for judgment, improper sentencing of a convicted criminal, and other misconduct.  Chapter 8.9, The Judicial Impact of the First Edition, Money Laundering, A Handbook for CDD Compliance with Pathway for Public Prosecutor Corruption Diagram 23 reveals the demand for judicial bribery.  See also Chapter 5, Corruption and Bribery aided with Corruption and Bribery Relationship Diagram 11 enlighten the possible circumstances trigger bribery to occur.  Given those demand circumstances, the following situations demonstrate symptoms of judicial corruption of a country:

  • Implementation of a criminal investigation not followed by the written criminal procedure code
  • Police and Public Prosecutor have too broad powers
  • Prosecution dominated regime at trial. To prove “Beyond Reasonable Doubt” is a lip service.  The burden of proof shifted to the defendant.
  • Lack of a proper and effective system to the complaint of a Judge
  • Political interference resulting no judicial independence
  • Political-triad regime

In dealing with judicial personnel whether currently in employment or previously engaged in legal employment, FATF Recommendation 10 – Customer Due Diligence (FAFT Recommendation 22 – DNFBPs: Customer Due Diligence) requires Compliance Officer to exercise enhanced CDD.  See Chapter 10.3, Risk-Based Approach and MER Comparison and The RBA application Diagram 27.  Beside necessary KYC procedures, the suggested significant CDD approach is:

  • Face to face meeting
  • Adopts a psychology approach to detect a lie
  • Nationality and residency of the customer. Mandatory enhanced CDD for higher risk country: FATF Recommendation 19 – Higher-Risk Countries
  • Nature of the business, transaction or opening a bank account check
  • Evidence to support the source of funds
  • Background investigation
  • PEP Self-Certification
  • Tax Residency Self Declaration
  • Asset Self-Declaration

When does Suspicious Transaction start?  The suspicion starts the moment Compliance Officer is in contact with the customer whether at a time face to face meeting or by a transaction by electronic mail: FATF Recommendation 20: Reporting  Suspicious Transactions

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Categories: UNODC, UNCAC, FATF, AML/CFT Compliance, Money Laundering, PEP, Corruption and Bribery