David Jancsics
Publications and news by David Jancsics.
Publications
Turning Legally Obtained Resources into Illegal Payments: A Money Dirtying Scheme
Everyone knows about money laundering – but what about money dirtying, i.e. secretly turning legally acquired money into illegal payments? A new peer-reviewed journal article looks at this phenomenon. Contact the co-author Jacopo Costa for questions.
Abstract
This study focuses on the movement of money in a financial infrastructure built to conceal its origin and destination. The literature has addressed this theme in the field of money laundering, converting illegal money into a legitimate source, yet less is known about the reverse process, hiding and transferring legally generated resources to pay kickbacks to officials.
We aim to analyze how these money dirtying schemes operate and explore their hidden mechanisms. The paper studies what happens to money in an unseen financial cluster and identifies the main actors and infrastructures essential for managing such process.
Using desk research and qualitative analysis of various documents, the article examines the corruption scheme designed by the Odebrecht group to generate resources to bribe politicians and bureaucrats in Latin American and Sub-Saharan countries. It zooms in on one key component of this system, a cluster around two Peruvian entrepreneurs, where money becomes hidden from the eyes of law enforcement agencies and investigators.
The main contribution lies in the conceptual distinction between money laundering and money dirtying schemes and the opportunity to expose and interpret the otherwise invisible critical processes of such illicit resource movements.
Suggested citation
Costa, J., Jancsics, D. Turning Legally Obtained Resources into Illegal Payments: A Money Dirtying Scheme. Eur J Crim Policy Res (2024). https://doi.org/10.1007/s10610-024-09591-z
Organisational forms of corruption networks: the Odebrecht-Toledo case
Actors in grand corruption schemes often conspire and deliberately create sophisticated networks to extract huge amounts of public resources from government systems. They hide such conspiracies behind hybrid formal/informal arrangements.
Using a mixed methods approach, this study investigates the corruption scheme initiated by former Peruvian President Alejandro Toledo and the Brazilian construction giant Odebrecht Group. We argue that separating the networks of the client (Odebrecht) and the agent (Toledo) sides provides analytical leverage for studying complex corrupt arrangements.
We found that the organisational forms designed by corrupt actors on either side were essential to ensuring the secret and safe operation of the network. Introducing the concept of organisational form into corruption research helps better understand the nature of these networks. We also found that different parts of the networks are shaped by different types of corruption. The article concludes with implications for practice.