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Algeria - Corruption

The law provides criminal penalties of two to 10 years in prison for official corruption; however, the government did not implement the law effectively. The World Bank Worldwide Governance Indicators reflected the existence of a corruption problem. Algeria is not a financial center, and financial transactions are tightly regulated. However, it is estimated that half of the country's economic transactions are done within the informal sector, effectively escaping the purview of state auditors. In 2005, the government adopted anti-money laundering legislation and established a financial intelligence unit to monitor suspicious financial transactions and refer violations of the law to prosecutorial magistrates.

Corruption existed, and according to Transparency International's Corruption Perceptions Index, Algeria ranked 99 out of 179 countries in transparency in 2007. The media focused especially on the customs police. According to press reports, 960 customs officials faced disciplinary commissions for official negligence or corruption charges between 2005 and 2008. Customs officials reported 215 disciplinary cases during the first quarter of 2008; 118 cases resulted in official reprimands, and nine cases resulted in suspensions.

In 2006 the government passed a law establishing a national anticorruption program, although parliamentarians removed a provision that required elected and senior officials to declare their assets and lifted parliamentary immunity in certain cases. The parliamentarians argued that the existing penal code was sufficient to punish corruption offenses and that the decision to lift parliamentary immunity should reside solely with the parliament. In 2006 the president issued three decrees to implement provisions of the anticorruption legislation. The three presidential decrees and the penal code address the types of offenses that the removed provisions were intended to punish. The decree also stipulates the formation of an anticorruption agency, but it had not been established by year's end. High-level government officials were subject to financial disclosure laws established by two presidential decrees published in 2006.

By 2007 corruption has reached unprecedented levels in the current regime. The ruling FLN party, intent on laying the groundwork for a Bouteflika third term, sought to install local officials through electoral wrangling based on loyalty even at the expense of competence. With oil prices at record highs there was less incentive for the regime to carry out much-needed reforms. High oil prices were bringing incredible wealth into the country, but ordinary people were not seeing any impact on their daily lives. A term seen often in the media now "Algeria is rich, but the people are poor."

Corruption had reached epic proportions, even within the military. Lieutenant General Ahmad Gaid Salah, commander of Algerian military forces, was perhaps the most corrupt official in the military apparatus. But the extent of the problem went all the way to the top. Many Algerians think President Bouteflika himself is not particularly corrupt, but they readily finger the President's brothers, Said and Abdallah, as being particularly rapacious. The Algerian military, meanwhile, has launched an anti-corruption program that is ambitious by Algerian standards but has left the senior leadership relatively untouched.

There were a number of arrests in 2009 of high-ranking Algerian Government officials in a variety of ministries and state-owned enterprises. Foreign companies do not complain of requests for bribes or lost contracts due to failure to pay bribes. However, customs officials have been known to demand bribes to expedite goods lingering in Algerian ports awaiting customs clearance. Many Algerian citizens believe that corruption is a problem within the upper reaches of government. Some evidence suggests that bribes are usually paid to bypass Algerian bureaucracy or to avoid government interference.

Irregularities, including the excessive use of private agreements often affected public procurement. According to the Ministry of Public Works, following the president's 2005 statement that the use of private agreements, including sole-source contracts, would be prohibited, government agencies began implementing a public tender policy for all infrastructure and large government projects. For those public tenders, evaluations were not released to participating companies, and evaluation methods and techniques were not clearly defined. Some agencies, however, continued to use direct contracts for public works projects.

The government took action on several high-profile cases of official corruption during 2009. On April 27, DRS officials in Annaba arrested Hassan Fellah, businessman and vice president of the Annaba local assembly, on charges of fraud, money laundering, and bribery to gain public office. Authorities alleged that Fellah was part of a criminal group involved in trafficking scrap metal and that Fellah paid bribes to be placed on a candidate list during a local assembly election.

On 30 May 2009, the customs inspector general stated in an interview on state radio that authorities arrested 202 customs officers during the year on charges of bribery. According to the Customs Workers' Union, 90 customs officers faced disciplinary boards during the first trimester of the year for official misconduct. Forty-three officers received demotions in rank, and the government dismissed seven officers. In 2007 65 customs officials were charged with corruption.

According to a 15 August 2009 press report, the court of Cheraga charged four Algiers police officers with trafficking stolen cars. Authorities placed one of the officers in pretrial detention in El Harrach prison. The court placed the three other officers under judicial control pending the outcome of their trial.

On 07 October 2009, an Algiers court began questioning high-level government officials suspected of extortion and influence peddling in awarding contracts to foreign companies involved in the construction of the East-West highway, one of the country's largest infrastructure projects. Authorities arrested and levied corruption charges against Secretary General of Public Works Mohamed Bouchama and a DRS colonel who was an MOJ advisor. On December 9, authorities indicted the Ministry of Public Works chief of staff, Ferachi Belkacem, in connection with the same case. Authorities placed Belkacem under judicial control. At year's end the outcome of the trial remained pending.

On 01 December 2009, the press reported a corruption scandal in the customs service dating back 10 years. Authorities charged five customs executives, six customs agents, and five waste exporters with forgery, filing false declarations, underinvoicing, and embezzlement of public funds. The report estimated losses between 1998 and 2001 at 100 billion dinars ($1.2 billion). Officials arrested the five customs executives and placed the remaining suspects under judicial control pending the outcome of their trial.

According to a 16 December 2009 press report, the inspector general of finance conducted 128 audits and issued 160 investigation reports on corruption during the year.

In May 2008 press reports quoted MOI officials as saying that since 2007, 1,325 employees of municipal and provincial governments were subject to legal proceedings for wasting public funds, forgery, and bribery. According to the report, authorities convicted 324 employees, while the others remained under investigation or had trials pending.

Although permitted under the constitution, authorities restricted access to government information. There is no law facilitating access to information. Throughout the year the MOJ, in cooperation with the United Nations Development Program, improved access to information about the country's judicial system and developed a modern information management system for penitentiaries. Citizens may now request personal legal records from the courts and receive the documents the same day.

Lack of government transparency remained a serious problem. The government did not release many economic statistics. All ministries have Web sites, but not all were updated. The MOJ provides information on citizens' rights and legislation.

The government investigated several high-profile corruption scandals in 2009 and early 2010. One investigation implicated officials at the Ministry of Transportation on charges of fraud related to the construction of the East-West highway. Another involved senior officials of the state oil company, Sonatrach, investigated for corruption in procurement. Lower-level investigations involved customs officials and private sector executives charged with embezzlement, illegal currency transfers, and misuse of public funds.



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