Beware the professionally corrupt

Dear Corruption Watch,

Many corrupt transactions either require professionals to execute them, or leave them in a position to be aware of them. Lawyers, engineers, auditors and doctors agree to adhere to professional codes of ethics. Theses codes should mean that those professionals party to corrupt activities should be unable to continue to practice, don’t they?  

Puzzled

Dear Puzzled,

You are right: most professionals have bodies (usually in the form of societies or associations) that lay down rules and regulate their conduct. So for example attorneys have the Law Society and advocates belong to the Bar with its Bar Rules. Ethical rules are enforced by means of various sanctions including suspension and if warranted, disbarment. A recent case against several Pretoria Advocates serves as a good example of corruption touching on both the public and private sector.

These advocates were involved in cases relating to the Road Accident Fund (RAF) set up by government to pay the victims of car accidents. You and I fund RAF each time we put petrol in our car (a certain amount of money is deducted per litre and paid over to the fund).

Now these particular advocates were writing huge fees (they were referred to as the “million-a-month” club) by making double or triple bookings for trials on the same day (it is not possible to run more than one trial a day and the Bar Rules specifically prohibit this). They then charged day fees for all the matters set down on one day because they simply settled all these matters so that they would never go to trial. 

The RAF was paying enormous fees to them. Somebody must have been suspicious. And the attorneys would have had to be in on it because at some point they would have picked up on the double bookings and the exorbitant fees.

A special tribunal consisting of retired judges heard the matter. The advocates were found guilty. The recommended sanction of disbarment (for some) and fines (for all) was enforced.

Doctors, engineers, accountants, all have opportunities to participate in corrupt activities (doctors using public facilities for private practice, engineers manipulating tenders in return for kick-backs, accountants signing off on fraudulent profits and hiding real losses). The US gave us an exquisite example of the lure of lucre that corrupted one of the largest accounting firms in the world.

Recall Enron, the US energy giant that crashed because of massive fraudulent transactions, leaving in its wake tattered reputations, a manager suicide, and one wife, who, mourning the evaporated bonus, remarked how tragic the whole affair was. Hubris, arrogance, and some plain old low-down dealing – Hollywood too got some yummy subject matter.  Anyway, lying prone like a star-spangled Ozymandias, investigators picking over its carcass, it soon became apparent that Arthur Andersen, Enron’s accountants, were complicit in hiding losses and signing off on fraudulent profits, leading to its effective dissolution. And so in this example you had the active participation of not only professionals, but an esteemed and trusted firm of accountants with a global reach, who meticulously and over a long period aided corrupt practices.

Private sector corruption remains corruption. As the two examples show (Enron was also intimately involved with governments globally), professionals can participate and do participate and in fact execute corrupt practices. When caught, they face not only the opprobrium of their professional body, but prosecution by the state (though in both cases this unfortunately happens far too infrequently).