Return mechanisms
Return mechanisms describe the practice of returning recovered money across borders indirectly via third-party entities that stand between cooperating governments. These entities might be called in to aid in the negotiations, as well as in the process of the distribution of the returned assets, especially in situations where there are challenging relationships between the negotiating governments or when receiving countries lack the necessary corruption controls to mitigate the risk of re-looting the assets.
International asset returns have often been channeled to the country of origin in this way through projects implemented by multilateral organisations, special mechanisms established for the purpose of the return, or through the involvement of non-governmental organisations. The BOTA Foundation in Kazakhstan, the Abacha returns to Nigeria, the U.S. – Equatorial Guinea and Jersey – Kenya returns are some examples of cases from the past years where third parties have been involved in the disposal of funds.
Benefits of this kind of return include increasing transparency and oversight of the return process by involving a third-party entity independent from the governments involved. This increased transparency and oversight, together with additional safeguarding measures usually championed by third-party entities, such as conflict of interest policies, can then lower the risk of misappropriation of the returned assets. This is especially relevant in countries with a weak rule of law or fragile contexts. Moreover, the third-party entities involved can provide additional capacity to the process, ranging from their programmatic strengths to oversight and negotiating skills.
However, the involvement of third parties often comes with higher administrative and financial burdens versus directly returning assets. The amount of these additional costs depends on the number of safeguarding measures and layers of oversight that are placed upon the return, which might need to be higher in politically challenging contexts. These mechanisms often also operate seperately to regular government channels, which can obscure them from public and parliamentary oversight and priority setting.
Latest research
CiFAR’s work on return mechanisms over the past years has been to analyse different methods for return and engage in discussions around how to best incorporate principles of accountability, transparency and participation into the process.
Civil Society Principles for Accountable Asset Return
The Civil Society Principles for Accountable Asset Return have been developed to be minimum, framework standards for the accountable and transparent return of public assets stolen through corruption and hidden overseas. While providing a common structure for return, they are designed to be supplemented by specific details based on each case and country situation. These Principles were developed over 18 months, involving the participation and input of civil society organisations active in ongoing asset recovery cases across the world.
Monitoring Returned Assets: A Toolkit for Civil Society Organisations
As global efforts to recover and repatriate the proceeds of corruption intensify, a critical question remains: how are these funds being used? To address this, CiFAR has launched Monitoring Returned Assets: A Toolkit for Civil Society Organisations, a comprehensive resource designed to ensure that recovered wealth truly benefits the public and is managed with the highest standards of integrity.
Indirect Asset Return Through Third-Party Entities
Indirect return mechanisms describe the practice of returning recovered money across borders indirectly via third-party entities that stand between cooperating governments. The BOTA Foundation, Abacha II, US – Equatorial Guinea and Jersey – Kenya returns are some examples of cases where third parties have been involved in the disposal of funds. They offer an indication into some of the economic, social and political challenges, as well as opportunities, that might arise with returns conducted through the use of third parties.
Management and Oversight of Independent Return Funds
This report explores international best practices for the oversight of independent return mechanisms, drawing on both principles and examples from other returns, for the Venezuelan Social Fund. In doing so, it explores the unique characteristics that the Social Fund would operate within.
Best Practices for Independent Return Funds: Lessons Learned for Venezuela
This report explores more general best practice when it comes to establishing an independent return mechanism. Drawing on experiences from Kazakhstan, Equatorial Guinea, Uzbekistan and Nigeria, it discusses how transparency, accountability and participation can be built into return mechanisms and identifies recommendations for the Venezuela fund.
