ABSTRACT
The media often carry news items of alleged transnational corruption involving huge corporations and public officials in the host country. In 2002, for instance, Thames Water, Britain’s biggest water company, was asked to renegotiate a contract to operate an $891 million1 Turkish water plant due to alleged irregularities in the commissioning of the plant. A number of Turkish Government officials were also investigated for misconduct in approving a government guarantee for the project. Wide publicity of such cases however has not seen a reduction in allegations of grand corruption.2 In 2005 the British Serious Fraud Office (SFO) started investigating3 an electricity trading enterprise, EFT, headquartered in London, for alleged corruption in the Balkans as a result of special audits commissioned by the UN’s4 High Representative in Bosnia. The allegation was that kickbacks5 may have been solicited by officials of a state owned power company to write advantageous electricity-swap contracts with private companies and that US6 government aid of $11 million, for providing electricity to war-torn states in the region, was diverted to offshore accounts.7 And more recently, the SFO’s decision to drop the investigation of the highly publicised allegations of bribery of BAE’s arms deals with Saudi Arabia is another instance.8
