Corruption in Nigeria

BY IDAMINA BABARINSA

Corruption is a major issue in Nigeria. It is common especially in the Nigerian government, but it can even be seen on the streets as policemen extort money from motorists to supplement their wages. It is in politics and government that corruption is most damaging, where it has become so common over the years that its effects are felt in every organisation, institution and office. It has become so pervasive and accepted that if one decides not to take part in it, the result may be loss of job or even life.

Nigeria is a country that has been blessed with a lot of natural resources with crude oil its major source of revenue. Nigeria is the 8th largest oil producing nation in the world and the largest oil producing nation in Africa. Despite all its riches, most citizens are living in abject poverty, as a result of corrupt leaders who are only interested in embezzling money to enrich themselves. Nigeria is currently ranked as the 18th most corrupt country in the world by Forbes Magazine.

“Corruption has become so deep-seated in the country that it has stunted the growth in all sectors and it has been the primary reason behind the country’s difficulties in developing fast,” reads a report by Nigeria-Planet.com. “Nigerians suffer because corruption made it hard to run government transparently, scandals became rife, projects were plagued by corruption which even seeped into so many private areas of people’s lives.”

The oil industry itself appears to be no exception, if a December 17, 2004 report by news agency Reuters is to be believed. Reuters stated that some 100,000 barrels of Nigeria’s oil exports were being stolen on a daily basis. This amounted to four percent of the country’s total oil exports. The report added that 70 percent of Nigeria’s population lives in poverty and that poor economic management and corruption were to blame.

Not surprisingly, corruption is a major issue in Nigerian politics.

In 1999, Olusegun obasanjo was elected president on an anti-corruption platform “Corruption is a cancer,” says Obasanjo, he added “it hinders development in any country”. One of his reforms included the creation of the Economic and financial crimes commission (EFCC), the main aim of the EFCC was to tackle and minimize corruption especially in the government. So far the EFCC has been making a lot of progress although it faces a lot of difficulties and challenges, the commission has arrested about 500 suspects and confiscated $500 million in the first 18months since it began targeting international e-mail scams and other fraud said Ribadu the EFCC chairman.

Campaigners argue that the fight against corruption can only succeed if it goes after the “untouchables”, public office holders who have direct responsibility for handling oil wealth but have broad constitutional immunity from prosecution. “We have a policy of suitable target for maximum impact, we went into e-mail scams and now we are going for public treasury looters” said Ribadu the EFCC chairman, he added “we are challenging the immunity; it is a complete conflict with the spirit of the constitution”.

The other organ also set up by the Federal Government to fight corruption in public office is the Independent Corrupt Practices and other Related Offenses Commission (ICPC) which too had scored remarkable successes since inception.

The government’s campaign against corruption manifests also in the setting up of the Due Process Office. This office oversees and demands that standard processes be followed in the execution of government activities and projects, thereby plugging avenues for bribery and corruption.

Part of the reasons for granting Nigeria debt forgiveness by the Paris Club is the renewed drive to curb corruption in the land and for transparency in government affairs.
With renewed confidence in the government to combat and reduce financial crimes and other corrupt practices, foreign investors have the guarantee of achieving their objectives in Nigeria.
While the problem of corruption has been around for a while, it is instructive to note that the will to combat it has become more resilient and with the expected co-operation of the international community, it will be reduced if not completely eliminated from Nigeria in due course.

Koch Industries Fails to Disclose Offshore Tax Avoidance

By Daniel Zoltai

The IRS Voluntary Disclosure Program for US persons who have not properly reported their non-US bank and other financial accounts and offshore structures, such as foreign trusts and companies controlled by US persons ended on October 15, 2009.
In the last week, Democrat Senator Carl Levin has offered his Stop Tax Haven Abuse Act as an amendment to the Senate Finance Committee's healthcare bill, bringing the issue of tax haven abuse back to the table just after the close of the IRS program, a move that is supported by Barack Obama.

With current reports detailing thousands of individuals coming forward to declare their offshore assets, there has been little disclosure made by major corporations. While public corporations are fairly transparent and often show up in examples of tax haven abuse, privately held corporations are much more likely to hide behind a veil of secrecy and employ complex off-shore structures in order to avoid taxes.
Take the example of Koch Industries. This the largest privately held conglomerate on the planet, employing approximately 70,000 people worldwide with annual revenues exceeding $100 billion. Their financials are kept strictly confidential and they do not disclose information about their management structure and activities. Koch is known to be aggressive with their tax avoidance strategies, having sued the IRS for $20 million in 2006 claiming that their tax refund was not correct. Public documents available on the Luxembourg government website, Legilux.lu, reveal that Koch operates a complex system of offshore companies and accounts in order to avoid paying US taxes on huge sums of corporate profits. Out of his Kansas office, Global Tax Director for Koch Industries, Craig M. Munson, manages these offshore corporations with the assistance of a shady Luxembourg company, ATOZ s.a., whose partners are primarily former Arthur Anderson staffers – the tax advisory giant that ceased to exist as a result of their felony conviction in the Enron “off-shore and off-balance sheet” debt scandal of 2002.
With the help of his offshore tax avoidance experts at ATOZ, Mr. Munson has set up a network of companies under the brand name “KoSa” that are used to move and consolidate funds offshore in order to avoid taxes. Some of the companies include “KoSa Foreign Investments” which was formed in June 2009 with over $1.8 billion in capital and “KoSa Luxembourg” which in August of this year declared a capital of over 520 million Euros. There are also vehicle companies such as “KoSa US Receivables Company” which declared a capital of nearly $185 million in August and “KoSa Canada Receivables Company” with a capital of nearly $35 million. These companies, and several others in the “KoSa” structures set up by Mr. Munson and his ATOZ facilitators are shells with no employees or physical operations. They are all incorporated under the “s.a.r.l.” status which has light reporting and governance requirements and is normally used for small businesses. When the sums involved are significant, such as the case here, the use of an “s.a.r.l.” is often cover for money laundering or tax avoidance schemes. In this case, it appears that these companies exist for no reason other than to avoid the payment of taxes. This is not the first time that Mr. Munson’s Luxembourg companies are involved in nefarious activity. In 2002, Arteva s.a.r.l., a Luxembourg company doing business as “KoSa” with Mr. Munson named as manager, was sued by the United States and plead guilty to charges of criminal price fixing.
A government source, wishing to remain anonymous due to direct proximity with the issue, has confirmed that the IRS will be investigating the matter.

Property Advisor Bradley Edwards Plays ‘Good Shepherd’ To Foreign Investors

By Sven Pomykalo and
Ugo Eriobuna

Bradley Edwards & Associates Ltd. is a real estate advisory firm based in Budapest, assisting and advising both private and professional investors making overseas real estate investments in Hungary. Their services include: property sales, property mortgages, property furnishing, property management, and property rental.

Robert Beck is the managing partner of the company. While Beck is a veteran of listing and selling property in the area for the past three years, his company is not a member of the Multiple Listing Service in Hungary, nor does he hold any position in Hungary either as a member or a trustee on any Real Estate boards in Hungary. He does however have over 2.000 apartments to sell and 500 to rent. Among all the agents selling properties in Budapest, his firm ranks 15th in terms of properties sold.

“The rental market is very strong in Budapest,” said Beck. “But in order to succeed in Real Estate business it takes basically luck, consistency, quality service, and also, good clients.”

In Property Sales, the firm offers a wide selection of properties available in the prime districts of Budapest for both commercial and residential real estate investments.

In regard to Property Mortgages, Bradley Edwards claims that mortgages for individuals in Hungary are as readily available as in Western Europe, subject to the usual status requirements. They add, however that it can be very time consuming and difficult for a foreign citizen to apply for a mortgage due to geographical distance and communication difficulties. By working in conjunction with several Hungarian banks, Bradley Edwards offers to assist its clients in finding the most convenient financing option; they submit the mortgage and loan documents and handle all communication with the bank.

Property Furnishing is an additional service offered by Bradley Edwards. According to their website, they supply contemporary furnishings of the quality and standard necessary for rented accommodation, providing individual items and flexible packages ensuring our solutions are within the client’s budget. Their aim, the site continues, is to provide a complete property furnishing service - right down to that last teaspoon. Their service includes budgeting, purchasing, delivery, assembly, installation and cleaning.

When it comes to Property Management, the firm provides the following: advertising the availability "for rent" or "for lease" of the premises when vacant; performing viewings to perspective tenants; executing leases and rental agreements on behalf of the property’s owner; collecting rents, security deposits, and all other receipts on behalf of the owner; providing all services necessary for the proper management of the property including periodic inspections, dealing with tenants, supervision of maintenance and arranging for repairs; paying from gross receipts all operating expenses which may be due by the Owner; maintaining accurate records of all money received and disbursed in connection with the management of the property.

Most of Bradley Edwards’ clients purchase their Hungarian property for mainly investment purposes, which the firm manages on their behalf. The firm currently manages a continuously expanding portfolio of upscale, newly built properties located throughout prime districts of Budapest at what they refer to as competitive prices. They claim the expertise of a professional staff with a high standard of ethics and a track record of sound decision-making and several years of experience and abundant resources.

Since entering Real Estate, Beck says, his life has changed for the better. He has today more Spanish clients, with less English and still fewer Irish clients. His reason for choosing Real Estate business is, he said, that it’s a very quick way to make money, and earn a better living. For now, he added, he is also happy with his company’s performance.

"White Man's Burden" - a film review by Ugo Eriobuna

Ugo Eriobuna
Review Of White Man’s Burden
1995 Release.



What would happen if race roles in America were reversed? What if blacks had all the power and whites had to fight prejudice and racism at every turn? Such is the setting of writer/director Desmond Nakano's brilliant film, White Man's Burden. The movie is a tightly constructed drama about Louis Pinnock (John Travolta), a reliable blue collar man who works in a factory owned by high-society business man Thaddeus Thomas (Harry Belafonte.) At home, Louis had to deal with a rough neighborhood, gang violence, and trying to provide for his wife (Kelly Lynch) and two kids.

The opening scenes of “White Man’s Burden” are very interesting, as it turns the tables on the color-coding in America society. It simply reverses the stereotypical roles of blacks and whites: the black characters are the wealthy, powerful establishment types living in big mansion in the suburbs, and the whites are a poor, disadvantaged minority group.

The greatest shortcoming of this quality film is its oversimplification of racial issues. It does however succeed by exposing a lot of our assumptions and prejudices. When John Travolta, as a factory worker uneasily approaches the mansion of Harry Belafonte, the millionaire factory owner, we’re forced to recognize that if the worker were black and the rich man were white, the scene would seem stable. Because it isn’t – because privilege is turned upside down in the world of this film – we’re forced to re-evaluate every conversation and difference in the film.
Travolta plays Louis Pinnock, a man who has been sent to his boss’ home to deliver a package. Belafonte is the factory owner, Thaddeus Thomas. Louis is hard-working, has a good record at the factory, and is happy to do this extra work on a voluntary basis in order to score points with his superiors. He was told by the housekeeper to go around the rear door of the mansion; he pauses uncertainly on the lawn and happens to see the rich man’s wife, dressed only in a towel.

Thaddeus sees Louis on the lawn, and jumps into conclusion that he is a ‘peeping tom.’ But he doesn’t make any accusations. He simply suggests, at a social function, that the factory should choose another man the next time they send somebody over to deliver a package. It is a well-known function of organizations that orders from the top get amplified on the way down to the bottom, so that a wish becomes an edict. Louis is then fired for this act.

This is not good. He has a family to feed. His wife (Kelly Lynch) fears they’ll be evicted from their home. In desperation Louis goes to Thaddeus’ home to plead his innocence, but he was turned down completely. And so, in desperation, he kidnaps the rich man - looking not for ransom but for justice.

It’s at this point that I thought the movie goes off the rails. It turns into a routine kidnapping thriller, complete with an extended chase scene, violence and some kind of confrontations with the police saying “he fits the description.”

Inevitably, Thaddeus and Louis develop respect for one another, and the millionaire learnt his lesson. But that’s not enough of a payoff for this movie because it’s obvious, it’s easy, and it comes too late, after action scenes derived from a thousand other movies.

What I wish to see in this movie is that the entire film had devoted itself to the examination of its challenging idea. The early scenes are clever and effective at using the reversal gimmick to point out the countless ways that skin color affects behavior, attitudes and expectations. Consider for example the way the white character deals at various points in the movie with black cops. Consider the cops’ assumptions. Savor the dialogs at the dinner party in the film, where the black millionaire entertains his guests with confused racist generalizations. Watch the way the millionaire’s wife reacted when her son came home with (gasp) a white girl. I only wished the film would have been pushed further on this direction – dealing with the social situations in the same way and not switching lanes in the middle of the film.

Foreign Demand For Real Estate Falls In Hungary

By Boma Oduma






With unrealistic expectations for the performance of the residential real estate market in Hungary leading up to the nation’s EU accession in May, 2004, demand for Hungarian real estate by foreigners has taken a downward turn. Before accession, anticipation for increased foreign interest was very high in Hungary. The expectation drove developers to start new projects with some of them successfully developed in less than a year. An example of this tremendous success is the Duna-pest residences in Budapest’s district IX, which managed to complete 90% of its apartments in less than a year.

Although the residential market enjoyed the enormous benefit between 1997 and 2004 of catapulted real estate prices thanks in large part to foreign investment – most notably by the Irish – by the end of 2004 the market as a whole began to encounter less interest from foreigner investors.

“The increase did not reflect local investment,” said Andor Szel of Central Home, a leading Budapest realtor that specializes in selling downtown flats to foreign investors, “and, likewise, the downturn does not really reflect the Hungarian economy either, which is in fact growing.”

The 1990’s saw a great influx of German, Italian, and Israeli investors coming into Hungary as the market first opened to foreign buyers, according to the Central Home website. Rental income reached levels around 12%. With these days past and gone, however, foreign investors are turning away from Hungary, pitching their tents and their presence in Dubai, among other places, which appear to be more favourable at the moment. Dubai’s real estate popularity with foreign investors stems in part from coverage in British media: an exposure sorely missed by Budapest, even by the media of its most recent investors - the Scandinavians, the Spanish, and the Brits – whose general public lack the awareness of Budapest as a possible place of investment.

A vital issue for choosing a country of investment is access to local mortgages. Unfortunately, Hungarian mortgages are not easily accessible: with high interest rates, it is quite difficult for investors to purchase real estate and to invest in Hungary.

“Mortgage facilities in Hungary are not functioning well,” said Szel. “Due to economic pressures, it is very difficult to obtain mortgages from local banks. And those that are available come with very high interest rates, thereby discouraging locals from buying.”

The loan ratio is also relatively low in Hungary when compared to other western European countries, which likewise keeps down the relative prices of Hungarian real estate. Citizens as well as foreigners are affected by this fact, which holds back private investment. In Britain, there is an open possibility to take a British mortgage for a foreign investment, which gives British investors a comparative advantage so long as interest rates in Hungary stay high.

All hopes are not completely lost, as there are high expectations for 2007 regarding the reduction of interest rates for Hungarian mortgages. This promises to enhance the allure of the real estate market, churning forth a new wave of investors in Hungary since other market factors are indeed quite favourable. These include a fully-implemented computerized real estate register - unlike other countries in the region where printed documents are required as valid proof of ownership - as well as an availability of potential investments that outstrips more saturated markets in Western Europe.

Counterterrorism In Budapest

By Philipp Sigrist

“International terrorism is a growing problem in our world today. We need to learn how to fight it”- this was the slogan at the first conference of the International Anti Terrorism Association (I.A.A) that was held in the Art Palace of Budapest on the third of March 2006. Eight experts in the field held the six hours conference for the stated purpose of discussing terrorism and its various side effects.

International terrorism has become a growing concern in today’s world. It has attracted the attention of many different organizations and prompted the creation of many others, including the International Antiterrorist Association (I.A.A), which was formed in Hungary in June of 2006, which recently hosted a six-hour conference in Budapest. The eight speakers – which included a Hungarian army general and an Police expert on explosives - provided insights on the issues surrounding and giving birth to terrorism, and on the sophistication and reach achieved by today’s terrorists.

General Szabo was the first speaker to the podium. His speech concerned largely international security and its challenges. He pointed out various threats and how they can be solved.

First, he said, the dangers today are more complicated than before, specifying that in today’s world of globalization previous dangers are even more dangerous because of technological development. Local, National, and International problems, he said, are all connected with each other, and an increasing gap between rich and poor countries raises the danger of organized crime and terrorism in developing countries.

“International terrorism is so powerful,” said the general, “that it influences relations between nations. The sobering disadvantage of globalization is that it is easily abused, especially economically. After the fall of communism, criminal organizations grew rapidly throughout the eastern block. This resulted in Hungary becoming a drug transit country. Corruption often occurs in changing political systems. Populations grow older and pensions come under threat. Flooding and other natural catastrophes compound these difficulties. How can these problems be solved? First of all more information is needed. Organizations must function more efficiently and international problems will find international solutions. But most importantly we have to understand the way terrorists think, get to know their philosophies, structures, financial assets, as well as their goals. To understand the way they endanger can be treated like a science.”

The general concluded by saying that any kind of problem can be easily challenged if it is tackled as early as possible. To this end, he advocated avoidance rather than confrontation, assuring his audience that the necessary counterterrorism organizations will be formed in the near future.

The second speaker emphasized attacks conducted with explosives. Unlike the general, he took the view that terrorism is an ongoing war, rather than a problem to be addressed and prevented.

The number of suicide bombers, he said, has grown dramatically in recent years. He specifically stated several places where attacks had been carried out and described the results of these attacks. One example he gave was a bomb attack in Tunisia specifically aimed at tourists in order to destabilize the country. Interestingly, attackers often manage to penetrate high security zones such as in Saudi-Arabia, Iraq and Israel, he said, adding that whatever security protection there is, attackers often manage to break through checkpoints and other barriers.

“The Madrid bombing showed that attacks have become very well organized,” he said, “The bombings did not only become more sophisticated but also more ruthless. During the Bezlan siege for example, terrorists did not stop from killing children. Terrorism is constantly evolving technologically, monetarily as well as in popularity. It began with simple bombs, but today terrorists can be in possession of dirty bombs such as chlorine or even nuclear waste bombs. But the biggest fear is that one day that terrorists might have access to a working nuclear bomb.”

A speaker from the police raised issues relating to crisis management in the case of an emergency. He used a recent local event as example, the October 6 riots in Budapest.

“Theoretically it seemed perfectly manageable and controllable,” he said “but in practice everything turned out to be completely different.”

Since the police did not have much experience with riot control, it had to learned through trail and error. An attack on Hungary can result in similar failures, he added, since police forces are not experienced enough for such tasks, as they have never happened before.

The final speaker, the head of the I.A.A Tamas Lax ended the conference by summing up the various speeches and made one final conclusive statement. “The international community can fight terrorism if the necessary institutions and agencies efficiently work together with their governments, but the responsibility also lies within each individual”.

Eyes Open To Windows Vista

By
Ugo Eriobuna
and
David Valker




Microsoft has long promoted itself as being about helping individuals and communities around the globe with the mission of enabling new avenues of social and economic opportunity extending particularly to the estimated 5 billion people that have yet to realize the benefits of technological advance. The multinational company’s tools to achieve this are transforming education, fostering local innovation, and enabling jobs and opportunities to create a continuous cycle of sustained social economic growth for everyone. While achieving these goals currently remains a distant prospect, thirty years ago the dream of a PC in every middle-income home seemed likewise impossible. Today, with Microsoft having reached more than one billion users, life has changed profoundly: information is more readily available, connections are more easily made and commerce is more quickly undertaken. Bill Gates - along with his company – has indeed moved closer to his goals.

The latest move is called Windows Vista. Naturally, it contains a dazzling array of new features; some of the most significant include an updated graphical user interface and visual style called Windows Aero. Aero uses graphics hardware to add translucent boarders to your windows. Windows Aero builds on the basic Windows Vista user experience and offers Microsoft’s best-designed, highest-performing desktop experience. Using Aero requires a PC with a compatible graphics adaptor and running a Premium or Business edition of Vista. László Vajgel, working for Fourcut, an editing studio, when asked his views on Vista he said:

“There have been a lot of changes in the new software,” said László Vajgel, of Fourcut, an editing studio in Budapest, Hungary. “The buttons and functions I got used to in XP are not quite the same in Vista.”

Vajgel also expressed doubts about the number of people actually making the switch to the new software in his home market of Hungary.

“Most people here use, well - what is a nice way to say - ‘unlicensed products.,’” he said. “This cuts off the biggest share of buyers. Also, people don’t think that the product is that good at first.”

Steven J. Vaughan-Nichols, editor of the US-based Ziff Davis’ Internet Linux & Open Source expressed his own views.

“Vista will be better than XP, which has easily been Microsoft's best desktop operating system to date,” Vaughan-Nichols said. “However, Vista also requires far more hardware oomph than previous Windows systems. I'd say Intel's recommendations are pretty much a minimum for Vista. I would only add that if you expect to see the fancy desktop, you need to invest.”

On the other hand, companies, institutions, and business organizations can afford to use this new software at the moment in Hungary. Most individual users living in Budapest think it is too costly and prefer to wait till the price value comes down. Moreover, as could be seen from the release of previous Microsoft operating systems, they always need some adjustments. In addition, the product is only useable after a few months of real testing by users.

The testing process by real users won’t make Microsoft weaker, as people opposing “going global” hope. Vista continues the path, started in 1975, in which the computer transformed from an awkward, unfriendly machine to our everyday instrument and “friend”.