Anti-Corruption Measures in Brazil

Office of the Comptroller General of Brazil

ANTI-CORRUPTION MEASURES IN BRAZIL Enhancing the public-private collaboration Jorge Hage Minister of State, Head of the Office of the Comptroller General of Brazil

Brussels, Belgium 27- 28 May 2009

Office of the Comptroller General of Brazil

Anti-Corruption Legislation in Brazil Constitutional provisions:  Article 74: Establishes the duties of internal control in the three Branches  Article 129: Prescribes competencies of the Public Prosecutor’s Office  Article 37, XXII: Establishes the penalties for acts of official misconduct in the Public Administration  Articles 85 and 86: Responsability crimes committed by the President of the Republic.

Penal Code, which includes:  Active corruption of domestic officials (art. 333),  Passive corruption of domestic officials (art. 317),  Active bribery in international business transaction (art. 337 - B);  Traffic of influence in international business transaction (art. 337 – C).

Office of the Comptroller General of Brazil Money Laundering (Law 9.613/98) Official Misconduct Law (Law 8.429/92) Public Procurement Law (8.666/93) Violations against the economic order (Law 8.884/94) Executive Power Internal Control Law (Law 10.180/2001) Office of the Comptroller General of Brazil Law (Law 10.683/2003) Brazilian Court of Accounts Law (8.443/1992) Law 1,079/1950 – Responsibility crimes procedural law

Office of the Comptroller General of Brazil Law on the Liability of Mayors and City Council Members (Decree-Law 201/1967) Attorney General Office’s Organic Law (Complementary Law 73/93) Public Prosecutor’s Office Organic Law (Complementary Law 75/1993) Law on the obligation to report assets and income in the Executive, Legislative and Judiciary (Law 8,730/1993) Law on prevention and repression of criminal organizations’ activities (law 9,034/1995) Phone communication interception law (Law 9,074/1995) Administrative procedure for the Federal Public Administration (Law 9,784/1999)

Office of the Comptroller General of Brazil Public service corporations regulation Law (Law 8,987/1995) Victims and Witnesses Protection Federal Program Law (Law 9,807/1999) Fiscal Responsibility Law (Complementary Law 101/2000) Crimes against Public Finances (Law 10,028/2000) Law on the secrecy of Financial Institutions operations (Law 105/2001) E-procurement system Law (Law 10,520/2002) Regulation on Politically Exposed Persons (Circular 3,339/2006 of the Central Bank)

Office of the Comptroller General of Brazil

Initiatives to improve the legal framework on the fight against corruption  Bill on Liability of Legal Persons for Acts of Corruption:  Civil and Administrative liability for acts of corruption committed by legal persons against the national and international administration.  Liability of legal person maintained regardless of the prosecution or conviction of natural persons.  Liability of legal person maintained regardless of incorporation, transformation or merger.  Sanctions: fines; suspension of activities; revocation of operating privileges; prohibition on participation in public procurement bids and contracting with Public Agencies; prohibition on official financing; dissolution.

Office of the Comptroller General of Brazil



Criminalization of illegal enrichment

(bill sent to the National

Congress on June, 2005)



Conflicts of interests

(bill sent to the National Congress on October,

2006)



Bill on access to information

(bill sent to the National Congress in

May 2009)



Civil Servant Asset Investigations (Executive Order)



Control of resource transfers (Executive Order)



Tackling Nepotism (cronyism)



Regulation of Lobbying

Office of the Comptroller General of Brazil

Federal Agencies responsible for combating corruption in Brazil • The Office of the Comptroller General of Brazil • The Federal Police Department - Ministry of Justice • The Federal Public Prosecutor’s Office • The Financial Activities Control Council – Brazil’s Financial Intelligence Unit • The Federal Court of Accounts • The Office of the Attorney General • The Federal Revenue Secretariat • The Department Cooperation

of

Assets

Recovery

and

International

Office of the Comptroller General of Brazil

The CGU, as the Internal Audit Unit and the Anti-Corruption Agency of the Brazilian Federal Government, implements the following actions:

- Internal Control

Management Advice Auditing

- Referral of audit results to the agencies with responsibility for enforcement of the applicable sanctions - Disciplinary Actions - Corruption Prevention

Office of the Comptroller General of Brazil

Simplified Organization Chart – CGU Comptroller General Public Transparency Parity Council

Federal Internal Control Secretariat

Executive Secretariat

Corruption Prevention and Strategic Information Secretariat

Disciplinary Board

26 Regional Units

Office of the Ombudsman

Office of the Comptroller General of Brazil

Follow up of the results of the Audits Political Control

Congress

Management advice and Administrative Sanctions

Federal Departments

CGU

Brazilian Court of Accounts Office of the Federal Public Prosecutor

Disciplinary Board

Disciplinary Sanctions

Administrative Sanctions (External Control)

Federal Attorney's Office Federal Revenue Service

Criminal Lawsuits Civil Lawsuits

Judiciary Branch

Office of the Comptroller General of Brazil

Main Prevention Measures • Increased Transparency • E-procurement system • Online monitoring of public expenditure • List of Ineligible Firms - CEIS • Incentive to Social Control • Education for Ethics and Citizenship • Implementation of International Conventions • Public - Private Cooperation Against Corruption

Office of the Comptroller General of Brazil

TRANSPARENCY INITIATIVES The Transparency Portal provides information on: • Resources applied directly by the federal departments • Federal resources transferred from the Federal level to the states, municipalities and Federal District.

• Federal resources transferred directly to the citizen.

• Transactions on the Federal Government's Payment Card.

Office of the Comptroller General of Brazil Direct Spending

Transparency Portal Budget year

Transfers By state/county Spending category

Punished Firms

Transfers to citizens

Office of the Comptroller General of Brazil

Transparency Portal in Numbers: Amount displayed

Over US$ 3 trillion 782,130,780 entries

Information

1,443,610

Pages visited 2008

1.443.610

285.968 2005

377.078 2006

646.701

2007

2008

Office of the Comptroller General of Brazil

Public Transparency Pages: Each Federal Body Public Procurement

Budget Expenditure

Public Agreements

Contracts

Per Diems and Tickets

389 Public Transparency Pages: 44 State Owned Enterprises with Transparency WebPages

Office of the Comptroller General of Brazil

International Awards UNODC Award “Important work in promoting transparency in public spending�

UNCAC States Parties Conference Bali 2008 One of the five best practices in the field of transparency and anti-corruption strategies in the world

Office of the Comptroller General of Brazil

Brazilian e-procurement system

Comprasnet Portal COMPRASNET is the access point to the Brazilian Federal Government’s eprocurement system. The portal enables users to view information on all Federal Government purchases of goods and services and to participate in the e-procurement process.

28

Spending Watcher data-matching and tracking system

Spending Watcher

Monitored Tracks

1.

COLLUSIVE BEHAVIOUR – BIDDER FIRMS

2.

AMOUNTS BEYOUND THE LEGAL THRESHOLD

3.

MORE THAN ONE “EXCLUSIVE” SUPPLIER

4.

INSUFFICIENT TIME FOR BID SUBMISSION

5.

BIDS REGISTERED ON NON-BUSINESS DAYS

6.

INAPROPRIATE EXEMPTION OF PROCUREMENT

7.

IMPROPER PROCUREMENT

8.

BIDDERS WITH SAME ADDRESS

9.

NEWBORN FIRMS

23

Office of the Comptroller General of Brazil

List of Ineligible Firms - CEIS

133 firms declared ineligible

777 firms temporarily suspended

Office of the Comptroller General of Brazil

133 ineligible and 777 suspended firms

Firm’s identification

Identification of the Public Body responsible for the sanction

State

Source of information

Office of the Comptroller General of Brazil

Incentive to Social Control The Office of the Comptroller General (CGU) developed the Keeping a Sharp Eye on Public Money Program, with a view to promoting change in society through education, access to information and social mobilization.

To promote social control, the CGU also developed the CGU’s Online School, offering course programs in: 1. Internal Control; 2. Social Control; 3. Social Control of the Government Education Programme – FUNDEB; 4. Public Procurement and Contracts.

Office of the Comptroller General of Brazil

Kid’s Website www.portalzinho.cgu.gov.br

Office of the Comptroller General of Brazil

Project “One for All and All for One for Ethics and Citizenship” “Um por Todos e Todos por Um pela Ética e Cidadania”

Partnership between the CGU and Maurício de Souza Institute, a non-governmental organisation.

Designed to foster citizenship, ethics and responsibility among participants: educators, students, families and communities.

Office of the Comptroller General of Brazil

Implementing International Conventions Against Corruption The CGU prepared handbooks and pamphlets aimed at disseminating the terms of the OECD Convention against Corruption. In addition, the agency developed a web site with information on the Convention.

Office of the Comptroller General of Brazil

UN CONVENTION WEBSITE

Office of the Comptroller General of Brazil

OECD CONVENTION WEBSITE

Office of the Comptroller General of Brazil

OAS CONVENTION WEBSITE

Office of the Comptroller General of Brazil

Public-Private Cooperation Against Corruption  Distribution of pamphlets on the OECD Convention to over 20,000 enterprises;  Research conducted with over 450 Brazilian enterprises to identify the anti-corruption and integrity measures adopted by enterprises;  Preparation and distribution of Ministerial Letters to 45 of the biggest export companies to raise awareness of the OECD Convention and of the integrity methods for fighting corruption.

Office of the Comptroller General of Brazil

Public-Private Cooperation Against Corruption CGU and Ethos Institute Partnership: CGU and Ethos established a partnership aiming at : - Stimulating and putting into force initiatives to strengthen good practices of corporative governance - Promoting ethics and integrity in the relationship of public and private sectors.

Office of the Comptroller General of Brazil

The Ethos Institute: The Ethos is a NGO created to help companies achieve a socially responsible corporate governance Mission: Mobilizing, sensitizing and helping companies to manage their businesses in a socially responsible manner, making them partners in the construction of a fair sustainable society.

Ethos is one of the institutions responsible for the development of the “Pact Against Corruption and for Integrity�, signed by over 500 companies, including all major companies in Brazil.

Office of the Comptroller General of Brazil

The Permanent Working Group, established to strengthen implementation of the principles set forth in the Pact Against Corruption and for Integrity and composed of 24 signatories and observer members, is tasked with: 1. Evaluating and considering effective measures to fulfil the commitments provided for in the Pact; 2. Expanding mobilization and enlistment of not-for-profit companies and entities; 3. Generating information and references to help companies promote integrity and fight corruption, and; 4. Integrating anti-corruption networks.

Office of the Comptroller General of Brazil

“Clean Company” Campaign Designed by the Ethos Institute, the “Clean Company” stamp is conferred to signatories of the “Pact Against Corruption and for Integrity.”

The stamp certifies a company’s commitment to eliminating all forms of corruption from the corporate environment and compliance with twice-yearly evaluations of the progress made to this end. www.empresalimpa.org.br

Office of the Comptroller General of Brazil

Initiatives being implemented by the CGU - Ethos Partnership Handbook on Fighting Corruption in the Private Sector: aimed at strengthening the dialogue between the public sector and the private sector for purposes of supporting private initiatives to promote integrity Distance course handbook above

offering

on

the

Handbook and distance course for SMEs (smalland medium-sized enterprises), inspired by the experiences of “Colombia: Rumbo PYMES Integras y Transparentes.�

Office of the Comptroller General of Brazil

CGU - Ethos Partnership Initiatives - Mapping of initiatives/entities aimed at promoting integrity in the private sector, with a view to disseminating principles and initiatives - Co-ordination of actions within MERCOSUR designed to give publicity to methodologies and tools to promote integrity in the business sector, as well as to establish corporate pacts in partnership with organisations in the MERCOSUR countries - Development of a handbook for both the private and public sectors identifying and providing information on illicit practices and the primary forms of bribery in public-private relationships - Discussions with the Working Group of the Pact Against Corruption and for Integrity on the inclusion of a clause establishing a commitment by signatories to avoid doing business with firms entered in the Transparency Portal’s List of Ineligible Companies.

-

Meeting with the 7 major Auditing and Corporate Consulting Companies in Brazil to foster initiatives to strengthen good practices in corporate governance.

Office of the Comptroller General of Brazil

Thank you!

Jorge Hage Minister of State, Head of the Office of the Comptroller General of Brazil

CONTROLADORIA-GERAL DA UNIÃO Setor de Autarquia Sul, Quadra 1, Bloco A Edifício Darcy Ribeiro - CEP: 70070-905 Brasília - DF – Brazil

www.cgu.gov.br

jorge.hage@cgu.gov.br