Drastic measures must be undertaken to end racketeering

Dec 28, 2020 Letters

DEAR EDITOR,
The Auditor General has reported countless cases of neglect or complete lack of accountability in state expenditures.
Some border on fraud especially when there are no receipts to support expenditures or names of shops where goods were purchased. Those of us who study economics call it theft or fraud. To that I will add ‘racketeering’. Those guilty must be prosecuted.
As the auditor reports reveal, there was what economists would describe as blatant theft of money from the treasury through all kinds of skulduggery, gimmicks, and make belief work to fill pockets. Whose?
We don’t know. But the theft involved government officials and cronies receiving money under false pretenses – contracts or state land given out to partners with kickbacks government officials. Some call it “crony capitalism”.
I call it “racketeering”, which is a crime in the USA and other democratic countries. But in economics, racketeering is mostly tied to labour financial fraud and other illegal acts within unions.
In Guyana, there are no known or reported cases of individuals held for racketeering, not in unions although there is lack of accountability in unions also.
The theft of government funds and fraudulent acquisition and distribution of land is more than what is defined under “crony capitalism” or cronyism. In Guyana, such fraudulent business activities by (ex or former) government officials and their partners in the private sector needs a new term that I coin as “racketeering economics” or “crony economics”.
I am not referring to labour union or mafia racketeering, a type of crime studied in sociology by criminologists. Racketeering economics is linked to government officers as opposed to labour union bosses. It is an organized criminal enterprise with political officers and their partners in private business; and labour leaders hardly have a role in it although some union leaders are defending those involved in such financial crimes.
Racketeering economics is a structured, criminal enterprise of business activities by officials engaging in underhand illegal economic activities to defraud the state. These government officials use state funds for personal gain (just to be clear and not to blame all government officials, only a handful of officials under the previous government and their partners in the private sector were involved in racketeering; they know who they are, and they are shameless).
Racketeering economics is when government officers engage in institutionalized fraudulent business dealing, enriching themselves or business partners by pilfering state funds.
It is the act of self-enrichment through illicitly-derived income — acquiring government funds in contracts or land deals through make believe projects; huge amounts of money are doled out to partners with resulting kickbacks.
It involved tens of billions of dollars annually, unaccounted for in non-existent activities or projects or payments for goods or services that were never delivered or performed or over-priced. The contractor got free money and officials get a nice cut. Regrettably, some prominent business folks in legitimate organisations were part of the enterprise.
Unfortunately, the predecessor government sanctified such illegal acts and authorised payments knowing they were not performed and as such, the creation of the term “racketeering economics”.
The illegal acts included direct and indirect theft of state cash and land, drug trafficking, fraud, embezzlement, money laundering, forgery, extortion, robbery, bribery, blocking investigation, obstruction of justice, ignoring authorised audits, among others.
Racketeering activities have devastating consequences for Guyana’s economy as a whole, both public and private institutions and businesses.
Drastic measures must be undertaken to end racketeering. Those big fish involved in racketeering should be made examples of with demonstrating effects to discourage theft of government funds and land. Auditor General Deodat Sharma must refer his findings to the police for investigation and prosecution.
Yours truly,
Dr. Vishnu Bisram

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