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Corruption - part 1: Who Pays the Price?

Experts who analyze corruption say there is no way to eliminate the greed that is behind many criminal acts. But, there are effective strategies to fight corruption in countries big and small, and rich and poor.

One strategy is to openly discuss the problem. So our look at corruption begins with an assessment of the global reach of corruption and who pays the price…Paul Miller narrates.

Former Enron chief Ken Lay faces U.S. federal charges for an accounting scandal that rocked Wall Street. "With the indictment of Mr. Lay today we now have under indictment all the top brass of Enron," announced a prosecutor.

The attorney for former Ukrainian Prime Minister Pavlo Lazarenko vows to appeal his client's conviction for extortion and money laundering --- crimes that Mr. Lazarenko committed while serving office in Ukraine…

And, in Mexico an explosive new tape surfaces in a bribery case linking a prominent businessman and a powerful politician.

These snapshots from 2004 offer a mere glimpse at the big picture of corruption. Experts put a trillion-dollar price tag on the cost of bribery every year.

Nancy Boswell, of the watchdog group Transparency International, says that's just the tip of the iceberg. "That doesn't include embezzlement. It doesn't include any of the other corrupt acts that add to the problem. It doesn't include bridges that don't go anywhere, roads that don't go anywhere, projects that are built at the expense of education, health care and the basic services that people really need."

Each year Transparency International ranks countries by perceptions about government integrity. The latest results show most nations score less than five on a ten-point scale.

And from Angola to Ecuador to Azerbaijan the index points to a direct link between corruption and poverty, explains Ms. Boswell. "In the resource-rich countries, those that have oil and other natural resources, you still find enormous poverty and you find them at the same time at the bottom of the index."

While perceptions are revealing, they do not tell the whole story.

Bill Allison, managing editor of the Center for Public Integrity, says, "There's always been corruption. What we looked at though, is what allows it to flourish."

He says that countries that disclose details about corruption may be perceived as more corrupt than those that keep the information secret.

So his group rates nations by the strength of their efforts to fight corruption in both government and private sectors. "There is a lack of integrity in the business world as well," he said.

Companies may raise questions of ethics even when they do not break laws.

For example, multi-national oil giant Halliburton, a company once headed by U.S. Vice President Dick Cheney, has come under fire for getting U.S. contracts in Iraq…

Mr. Allison explained. "Now the vice president says he doesn't have anything to do with Halliburton, he doesn't have anything to do with the contracts, and for what it's worth, there's absolutely no evidence that he does. However, anybody sitting in the Pentagon who's dealing with a bid from Halliburton -- I can't believe they have no idea who Halliburton's former CEO is."

Whatever the outcome of investigations into Halliburton, experts say the constant scrutiny of watchdog groups tends to have a cleansing effect.

But nations steeped in corruption find it tough to open the books. Recently Transparency International gathered some new leaders who were elected on pledges to clean up corruption.

Again, Nancy Boswell. "There was a Kenyan official who was very brave in terms of speaking out and speaking his mind and he said, ‘We've learned some lessons. One of them is that the vested interests have created practically a parallel state. They have the levers of power in their grasp. They have enacted laws that help them continue their corrupt ways.’ And changing that is enormously difficult," she added.

Difficult, but not impossible. In December 2003, the UN passed a convention against corruption, which is the first international legal tool to criminalize and prosecute offenders.

Recently, Peru's government used that convention to call on Japan to return their exiled ex-president Alberto Fujimori, who is wanted for embezzling public funds.

In nations long tarnished by corruption, bringing officials to justice may go a long way towards cleaning up the system and restoring the public’s sense of national pride.