The Foreign Correspondents' Club Hong Kong

Ex-Hong Kong Home Secretary Patrick Ho bribery case ‘an attempt by the U.S. to embarrass China’

The reason United States prosecutors “went after” former Hong Kong Home Secretary Patrick Ho Chi-ping over alleged bribery is because they want to “squeeze” him for information on Chinese companies that routinely bribe foreign officials, according to veteran New York criminal defence lawyer Robert Precht.

Robert Precht discusses the Patrick Ho case at the FCC on January 29, 2018. Photo: Sarah Graham/FCC

And it’s highly likely that President Donald Trump’s administration is using the case in an attempt to embarrass China, Precht said, via the far-reaching US Foreign Corrupt Practices Act (FCPA) which means companies and persons can be held criminally and civilly responsible for corruption offences committed abroad.

Ho is currently in a high-rise Manhattan jail awaiting trial on charges that he made millions of dollars in bribes to African officials to obtain lucrative oil rights for a Chinese conglomerate. If convicted he faces 20 years in prison.

Precht, President of Justice Labs, a legal think tank based in New York, said the case was likely to produce incriminating evidence about companies with close ties to the Chinese government.

Precht said the evidence against Ho, Hong Kong’s Secretary of Home Affairs between 2002 and 2007, was “absolutely overwhelming”. Much of it, he said, was based on intercepted emails. “My defence would be that he has to be innocent because no one would be so stupid to lay out their guilt [in emails],” Precht added.

Ho is accused alongside former Senegalese foreign minister Cheikh Gadio of offering a US$2 million bribe to the president of Chad for oil rights on behalf of CEFC China Energy (CEFC), a Shanghai-based energy company, while in New York at the U.N. Gadio is not named on the indictment, Precht said, indicating that he was involved in a plea bargain. CEFC has denied authorising Ho to engage in corrupt practices.

Although Ho pleaded not guilty to the charges at a hearing earlier this month, Precht said it was likely prosecutors would put him under enormous pressure to change his plea.

Precht explained that the FCPA gives America the power to prosecute people it believes to be involved in corrupt practices where it could claim jurisdiction. For example, an email sent from overseas that passes through an American server can give prosecutors jurisdiction. In Ho’s case, meetings took place in the U.S., and additionally Ho created an NGO in Virginia, funded by CEFC which made the case a “domestic concern” for America.

The problem of Chinese companies bribing foreign officials in return for lucrative contracts was extremely widespread, Precht said, adding that he hoped that this case would prompt the Chinese government to crack down on it.

Revealed: Methods of torture used against China’s officials in corruption crackdown

Sophie Richardson, China Director, Human Rights Watch, revealed how China’s corruption suspects are kidnapped and tortured

The methods of torture used to extract confessions from suspected corrupt Chinese Communist Party officials was revealed as Human Rights Watch released its report at the FCC into the shuanggui detention system.

Beatings, solitary confinement, being made to stay in one position for hours, sleep and food deprivation were just some of the ways in which detention officers from the party’s CCDI (Central Commission for Discipline Inspection) coerced confessions.

Sophie Richardson, China Director of Human Rights Watch, called on the Chinese government to immediately abolish shuanggui, its secretive detention system that operates outside of China’s legal system, during the report release on December 6.

When President Xi Jinping came to power in 2012, he announced a far-reaching anti-corruption campaign with a pledge to eradicate graft once and for all from the Communist Party. The campaign has seen both “tigers and flies” – high-ranking and low-ranking officials – detained and prosecuted for alleged corruption. What is lesser known is how shuanggui officers operate.

The Human Rights Watch report, titled Special Measures: Detention and Torture in the Chinese Communist Party’s Shuanggui System, is based on 21 interviews with four former detainees as well as family members of detainees, 35 detailed accounts from more than 200 Chinese media reports, and analysis of court verdicts from across the country. It outlines how suspects are led under false pretences to a meeting place where they are then spirited away for prolonged periods of time, their families not knowing where they are or why they have disappeared. They are then taken to shuanggui facilities, which the report stated have padded walls in order to prevent detainees from committing suicide, where they have no access to lawyers.

A drawing of a room used for shuanggui detention by a former detainee.

One detainee, a former police chief from Jiangxi Province, recalled: “For nine days and nine nights I sat in tiger chairs; and urinated and defecated into adult diapers…for over a hundred hours, whether it’s day or night, they took turns interrogating me.”

Accounts from former detainees detail the various abuses inflicted by officers to extract confessions from the suspects, who are then typically brought into the criminal justice system where they are convicted and sentenced to often lengthy prison terms.

Ms Richardson called on China to abolish shuanggui, saying: “President Xi Jinping has built his anti-corruption campaign on an abusive and illegal detention system. Torturing suspects to confess won’t bring an end to corruption, but will end any confidence in China’s judicial system.”

She added: “Nobody, not even guilty Chinese Communist Party officials, should be denied basic fair trial rights or tortured.”

Figures in the report show that in 2015, 336,000 individuals were punished internally in the war against corruption. A further 14,000 were handed over to the courts for prosecution.

Start at the top and work down to fight corruption, says top Indian graft buster

Dr. Subramanian Swamy, member of India’s parliament, discusses his country’s fight against corruption

Going after the corrupt elite is the only way to prevent corruption on all levels of society, according to politician and graft buster Dr. Subramanian Swamy in a club lunch discussing the issue and how it affects India.

And if you want to prevent so-called ‘black money’ – corrupt money kept seemingly at arm’s length in overseas accounts – from lining the pockets of greedy officials, take the lead of the German government, which in the Liechtenstein tax scandal of 2008 ended up paying off a bank employee to hand over a list of clients who were ferreting money away, he said.

Mr Swamy, a member of India’s parliament, has been highlighting corruption in government for several years and is currently awaiting the trial of Sonia Gandhi – President of the main opposition Indian National Congress party, and her son, Rahul, on graft charges. The Gandhis — part of the famous political dynasty that includes India’s first Prime Minister Jawaharlal Nehru and his daughter Indira Gandhi – are alleged to have illegally acquired the now-defunct National Herald newspaper’s assets after buying its publisher through a new private company, Young Indian, using a loan from party funds.

India’s anti-corruption fight: @Swamy39 talks about how cash is sent out and brought back in to the country pic.twitter.com/041dLUOaA9

— FCC, Hong Kong (@fcchk) November 14, 2016

The Ghandis are currently on bail awaiting the start of the trial on December 9.

Dr Swamy has used the courts in order to go after the most influential people in the country and played a major role in exposing the 2G spectrum scam. He spends most of his time poring over documents and legal framework to determine whether laws have been broken by those alleged to be engaged in corrupt practices.

Mr Swamy uses a mathematical analysis based on the probability of detection to explain how people come to accept bribes. He concludes that the cost to the corrupt person of being caught, and probability-weighted average with the value of the gain from the corrupt act proves that even if the probability of detection is low, if the cost to the corrupt of detection is some big multiple of the gain from the corrupt act, every rational person would voluntarily choose not to bribe or accept a bribe.

But he says corruption isn’t only a temptation of the elite – in India it filters down to all sections of society. He said that despite having the checks and balances of the judiciary and the media, corruption was still widespread as people felt over-taxed throughout the country.

But he added: “Unless you catch the people at the top you cannot create the necessary fear factor for those at the bottom.”

When asked about the recent demonetisation of Rs 500 and Rs 1,000 bank notes in India in a bid to uncover billions of dollars in undeclared wealth, Dr Swamy criticised the government for a lack of contingency plan to ensure ordinary citizens were not left without cash.