Hacking Corruption

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Tech Tools to Fight Graft in the Americas 

Across the Americas, corruption scandals have eroded citizens’ trust in their governing officials and institutions, leading elected leaders to promise they will root out graft. Against this backdrop of a growing citizen backlash against corruption, the Peruvian government designated “Democratic Governance against Corruption” as the central theme of the 2018 Summit of the Americas—the triennial meeting of heads of state from countries in the Americas. The Summit produced a Lima Declaration with 57 concrete actions to strengthen the fight against corruption in the Americas, including one–Commitment 17–specifically dedicated to promoting the use of new technologies to promote transparency and government accountability.

A new report by the Inter-American Dialogue’s Peter D. Bell Rule of Law program and the Adrienne Arsht Latin America Center at the Atlantic Council aims to advance Commitment 17 by examining the promise of tech solutions to assist the fight against corruption, specifically in public procurement. The report provides examples of a number of such solutions, as well as identifying obstacles to their more widespread adoption and proposing appropriate policy responses.

 

Diagnosis: Opportunities for Empowerment 

Although most Latin American governments have made important strides in making commitments to improve government transparency, there remains a gap between what is promised and what is implemented. Technology can be a crucial enabler in bridging this gap, in combination with the requisite political will, civil society oversight, and international cooperation.

The following is a mapping of the technological opportunities that exist to combat corruption in public procurement in the region, and corresponding challenges to their more widespread and effective adoption.

1) Open data and e-procurement

The publication of public contracting information in open data format can allow civil society and other assigned monitors to play a leading role in identifying and denouncing corruption, especially if a government does not have the resources or political will to pursue corrupt actors. Beyond simply publishing procurement data in open format, the next step in streamlining the public procurement process is creating a fully digitized and automated e-procurement portal, which itself must be accompanied by regular audits and oversight by responsible agencies to prevent irregularities.

2) Smartphones and civic tech apps

The power of smartphone technology, coupled with the disseminating power of social media, has become a means to gather evidence of misconduct and use it to demand political and judicial redress. Civic tech applications can enhance public procurement oversight by allowing citizens to track the progress of public works on the ground or report bribe-taking by public officials. Two examples of civic tech apps working to foster a culture of community responsibility and an expectation of government accountability are Promise Tracker in Brazil and Supercivicos in Mexico. 

3) Big data and artificial intelligence algorithms

Widespread risk assessment is often beyond the capacity of manual analysis: there are often far too many datasets and variables for even experienced data analysts. In this respect, artificial intelligence (AI) algorithms—such as the European Commission’s Arachne tool and South Korea’s Bid Rigging Indicator Analysis System (BRIAS)—can be critical in identifying irregularities in public contracting processes and closely monitoring high-risk projects. Other data mining and analytics tools can, by taking large open datasets and thoughtfully cross-referencing, also be useful in identifying risky transactions.

4) Distributed ledger technologies 

Distributed ledger technologies (DLTs) such as blockchain can be hack-proof methods for verification and certification of transactions in public procurement. DLTs democratize the verification process for transactions and distribute the data management responsibilities for a series of transactions across multiple participants, all of whom have access to a data chain that is unbreakable due to the application of cryptographic math that will flag attempted tampering, and all of whom have real incentives to identify irregularities.

Challenges: What is Lacking

1) Collaboration across sectors

A central challenge is creating deeper links between civil society organizations that collect, mine and publish government data to expose corruption, and government agencies—regulatory, prosecutorial or judicial—to support exchanges of information and best practices that will ensure formal investigatory follow-up. 

2) Better data

 The quality of government data is still variable across datasets and agencies, and is often incomplete, unverified, unreadable, not disaggregated, and/or not timely. Freedom of information laws are often underenforced in the region, produce sub-par or incomplete responses to requests, or are weakened when administrations inclined to opacity come to power.

3) Making the most of available data

Governments do not do enough to proactively promote how the information they publish can be used by public officials to improve public procurement policies or oversight, or by civil society in a watchdog capacity. Furthermore, technical expertise in governments is at times limited to a handful of officials, and more broadly to a narrow segment of the population.

Policy Recommendations

1) Work together toward truly open data

  • Adopt international public contracting data standards.
  • Disclose all information on beneficial ownership and contract renegotiations.

2) Focus on data deliverables and long-term digital capacity building plans

  • Identify common corruption correlations and consistently cross-reference datasets.
  • Onboard tech and publish data with a clear anticorruption purpose.

3) Create proactive tech-for-transparency partnerships with civil society

  • Establish exchanges of best practices.
  • Appoint a clear point of contact within government agencies to be accountable to tech-enabled whistleblowers.

4) Enlist the private sector 

  • Work toward the scalability of efficient test pilot programs.
  • Reward transparency and “clean” business practices.

 

This report is made possible thanks to the Open Society Foundations


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