Vietnam mulls mandatory electronic transactions to fight graft

By Vuong Anh   July 24, 2016 | 09:04 pm PT
Vietnam mulls mandatory electronic transactions to fight graft
Photo by Reuters/Kham
Can new regulation really cut out under-the-table cash exchanges? 

The Government Inspectorate plans to make electronic transactions mandatory for state officials making transactions worth over VND20 million (US$896) in a move to combat bribery and monitor fraudulent asset movement.

The proposal was announced at a recent press briefing in Hanoi, where a representative of the Inspectorate, the government's top anti-corruption watchdog, said one of the best ways of controlling corruption is to monitor banking transactions and limit the use of cash.

Ngo Manh Hung, deputy director of the Inspectorate's Anti-Corruption Bureau, said the Inspectorate is looking to put a specific clause into the amended anti-corruption bill, which requires “any official making a transaction of over VND20 million to do so through their bank accounts”.

Hung admitted that cash transactions, including under-the-table money and cash bribes, have made it more difficult for the government to manage officials' assets and fight corruption.

The Inspectorate's suggestion follows growing public skepticism of the state's anti-corruption progress after a number of serious corruption cases were exposed recently such as the luxury car incident and a trillion-dong case involving Vietnamese bankers.

Questions were raised during the press briefing on how the government agency should manage the assets of people in powerful positions, especially when there are signs they are stashing assets overseas.

"These are new and difficult issues which require changes to the law,” Hung said. Authorities have been looking for a way to manage expenditure and asset movements through overseas transactions, he added.

In 2013, a government decree made it mandatory for public officials to submit financial disclosure forms. The decree required around one million officials to declare incomes and assets worth more than the equivalent of $2,400, including cash, gifts, savings, stocks and vehicles – held both inside and outside the country.

However, these financial disclosures have added to Vietnam’s poor record in its anti-corruption fight. Only 17 out of 4,800 verified asset declarations were found to be false over the last 10 years, while nearly one million declarations had been submitted as of May 2015, according to data from the Central Inspection Committee, the Communist Party's top watchdog.

Pham Trong Dat, director of the Anti-Corruption Bureau, told VnExpress that the culture of "using too much cash has been a very big obstacle in managing personal wealth, or in other words, it’s impossible to control corruption at the moment”. Solutions such as paying monthly salaries through ATMs have been employed but they only help monitor salaries, while other sources of income such as bribery are difficult to control, Dat added.

In a report to the government, the Inspectorate said only 10 officials have been disciplined for graft, and just a tenth of losses resulting from corruption have been recovered over the last 10 years. Losses to corruption totaled VND59.7 trillion ($2.6 billion) and 400 hectares (988 acres) of land in that time, but Vietnam has recovered merely VND4.67 trillion ($210 million) and 219 hectares.

Transparency International (TI)’s Corruption Perceptions Index in 2015 ranked Vietnam 112 out of 175 countries and territories - a modest improvement from 116 and 119 in 2013 and 2014 respectively. 

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> 10 officials disciplined over corruption in 10 years

> TPP will help Vietnam combat corruption: Vietnamese official

> Vietnam to investigate corruption investigators

> Anti-corruption officials want to tighten noose on cash transactions

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