Stolen asset recovery: What can universities do?

African universities have been late to join the battle for the recovery of stolen assets that resulted from illicit financial flows (IFF), which have an adverse impact on public revenue and are ultimately reducing the money allocated to education.

The latest report of the United Nations Interregional Crime and Justice Research Institute (UNICRI) titled Illicit Financial Flows and Asset Recovery in the State of Libya that highlights the impact of IFF on education development was published on 27 May 2021.

The UNICRI report makes recommendations about how the education sector in Libya, among other countries, can be strengthened by using recovered assets.

“[If] Libya were to prioritise the recovery of only 10% (approximately US$120 million) of the estimated US$1.2 billion in assets lost through IFF, it would be possible to easily cover the entirety of the funding requirement of the United Nations Humanitarian Response Plan’s budgetary request for the education sector in Libya, ensuring access to safe, inclusive and quality education for 83,500 young students and adolescents (46,000 girls and 37,500 boys) and supporting over 1,800 teachers and education personnel across multiple geographic regions,” the UNICRI report states.

Higher education expert Ahmed Atia, head of the department of advisory and research at the faculty of medical technology at the University of Tripoli, welcomed the report.

“This is only one step forward in a long, rocky road across Africa as stolen assets are not unique to Libya,” he told University World News.

In the Economic Development in Africa Report 2020, the United Nations Conference on Trade and Development (UNCTAD) says that, in African countries where IFF are high (South Africa, Democratic Republic of Congo, Ethiopia, and Nigeria), governments spend 58% less on education than countries with low IFF.

UNCTAD found that an estimated US$88.6 billion leaves the continent as illicit capital flight – enough to finance almost half the annual financing gap of US$200 billion the continent faces to achieve the Sustainable Development Goals (SDG).

IFF refer to the illegal movement of money from one country to another through organised crime and trade in illegal goods as well as illegal and illicit tax and commercial practices, according to the October 2020 report published by UNCTAD and the United Nations Office on Drugs and Crime.

“Libyan as well as African universities must join forces in the battle of returning stolen assets, especially with the financial challenges facing the higher education sector as a result of the COVID-19 economic crisis,” Atia said.

Awareness campaigns

Atia said the universities should also launch awareness campaigns highlighting the financial, social, economic, and developmental costs of organised crime with potential harm and cross-border connectivity in the region.

The UNICRI report highlights these factors, referring to activities such as human trafficking, migrant smuggling, arms trafficking, drug trafficking, oil, gasoline, and diesel smuggling and terrorism financing.

“These university campaigns will educate students and academic communities and raise public awareness as well as generating understanding among key decision- and policymakers which will help in designing effective policy responses,” Atia pointed out.

Ehi Eric Esoimeme, a financial crimes consultant based in Nigeria, told University World News that, “African universities are lagging behind in producing ready graduates to work in the field of IFF, organised crimes and stolen asset recovery.” Most universities do not offer specialised courses in these important areas.

“What we see are general law courses like criminal law and banking law on the undergraduate level. Some universities in Africa like the University of Lagos and the University of Ibadan are now attempting to bridge the gap with postgraduate programmes on asset recovery and corruption,” Esoimeme said.

Asset recovery consultant Gary Miller, who is chair of the International Fraud Group (IFG), pointed out that few top universities in the world have recognised courses to train law and other students in the discipline of fraud investigation and international asset recovery.

“The Queen Mary University of London Centre for Commercial Law Studies is offering what I believe is the world’s first course on international asset recovery,” Miller said.

Degree in fraud investigation and asset recovery

“All universities, particularly those that have a law faculty, should be carrying out research and academic studies as well as offering degree and educational training programmes in this important field,” Miller said. The IFG could assist universities all over the world – including African universities, he added.

Esoimeme pointed out that regulatory training and advisory firms in Africa like the South Africa-based Navigate Compliance and Nigeria-based E-Four and AAF have also tried to bridge the gap with specialised workshops and regulatory courses in financial crime compliance.

“I think a partnership between national, regional or international law firms and global universities along with African universities could help kick-start the development of specialised educational and research programmes at both undergraduate and postgraduate levels in African universities,” Esoimeme suggested.

He said that African universities should use the partnerships with law firms and global universities to implement training programmes that would provide comprehensive training tailored to the needs of staff working across many agencies, including central banks, tax and revenue authorities, customs, and ministries of finance and justice.

“The training of practitioners and industry professionals, as well as providing seminars and lectures could count towards continuing professional development for African experts who are practising in the field of IFF and asset recovery,” Esoimeme said.

Practical training in HE

Gretta Fenner, managing director of the Basel Institute on Governance in Switzerland and director of its International Centre for Asset Recovery, told University World News that universities (law faculties in particular) need to include a lot more theoretical and practical training on matters related to investigation and prosecution of corruption, including novel avenues for recovering stolen assets such as non conviction-based forfeiture.

“We see all too many young lawyers graduating from university who have no idea whatsoever about these matters, know very little criminal law, and have been trained almost exclusively in commercial law,” Fenner said.

“If we do not build these subjects into university-level training, young lawyers will not even understand how important a career in public service prosecution and economic crime is, and will all gravitate toward law firms,” she added. “We will miss out on the most talented lawyers.”

Without these lawyers, prosecution services and law enforcement have little chance to withstand the excellent lawyers criminals can typically afford.

“It does not necessarily have to be a dedicated centre for asset recovery within African universities, although I think research departments (which also teach, of course) on IFF would certainly be highly encouraged,” she said.

Fenner said that asset recovery is a highly technical field which may not necessarily need a special university department but could be part of a legal department or an IFF department.

The way forward

Esoimeme said Africa has an acute shortage of well-trained lawyers with up-to-date knowledge about IFF and asset recovery and who can respond to the continent’s development needs.

Higher learning institutions offering legal training must reform through sustainable action plans to improve academic content, teaching and research quality, community outreach and dissemination to deliver applied research and produce a future generation of lawyers ready to develop innovative investigative and legal tools to facilitate the effective tracing and recovery of proceeds of crime and deprive criminals of their illicit gains which could be used to achieve sustainable development.

The United Nations’ 2030 Agenda for Sustainable Development identifies the reduction of IFF and the strengthening of the recovery and return of stolen assets as priority areas needed to build peaceful societies around the world.