Ladies and chess, thank you very much for coming. Coming. , thank you for we are in the season where the city tends to empty out and we are delighted that you are here that isss a problem arguably as important here in the United States as it is around the world, where we will be focusing on it. Let me briefly introduce myself and who will be conversing with today. Im sarah chase at Carnegie Endowment for International Peace and the democracy and rule of law program, not the climate and energy program. ,imon is going to kick us off simon taylor, one of the founders of Global Witness, which is in my view one of the most innovative and effective organizations working in the space around the world. It very interestingly combines advocacy with extremely rigorous investigations, and is one of the things we will be talking about today, a recent report by Global Witness about shell pass activities in nigeria. s activities in nigeria. He hel a coalition of 40 countries worldwide, called publish what you pay. Sitting next is the dean of columbia journalism school. Mother dimension of effort. Nother dimension of effort. He has won two surprises. For reporting on the securities and exchange commission, which again, as some real relevant. He is the author of private empire, which i recommend all of you, when you are done with private out and buy empire. It toes you a lot, not just about the industry but an important element of u. S. Politics. Another guest is a member of the human and Environmental Development agenda. I just love that. Lets put that together. Human and in Environmental Development sidebyside. It is in lagos, nigeria. It on the oilfor sector in nigeria and participated in this investigation as well as others. Thanks again. Let me come over here and join the conversation. Justmeans like i have to ask your forgiveness. While i do this. Askingjust start, by about this. It and what caused you at Global Witness to feel like this was such a critical subject to investigate . That is a good question. It is not just they who knew. Other people knew. I can start with some boring facts. I think they say quite a lot. Many people will be familiar with the Antibribery Convention from 1999. A study of some 400 Corruption Cases. Fully two thirds of the cases they looked at involved four sectors. Guess what. The most times, the extractive sector. Most of these involved public procurement contracts. Most also included players who were from wealthy countries. I have spent Something Like corruption. I have a further twist. Which iser ask corrupt. I ask which is not corrupt. One of the things we have been doing is look at which i come into play. Were talking about how banks operate, how many flows and so on. We have to come back to some of that in the discussion later. But to actually understand the different myriad mechanisms of investigate mechanisms, we investigate. S is just the latest west africasbly largest. The history is too long to go into it the on the highlevel detail. April 2011. In netherlands the deal the problem is they had previously spent two years negotiating with the person who owned it. In april 90 april 1998 someone set up a Shell Company called malibu, basically a piece with othersgether sort of acretary was lawyer in a backstreet office, for those of you who know the breaking bad theory. That is what we were involved with. Investmentiondollar going to bed with a piece of paper. No skill set, no knowledge, no backup. They mustve known this was a stolen piece of real estate. Battleslitigation happened. Malibu lost the block. Show built it. Various litigation processes. Then we realized in the beginning there was a twoyear time with delightful court cases. One particularly noticeable is one where a former miasix wascial helping them and saido some people it was difficult to come to an arrangement where they would be happy with the amount but we are getting on much better. Effort they went through collapsed. But then that general who also happen to be a lawyer rocard the deal. Billion dollars through nasco arrangement in london run by jp morgan and the money filtered off into Shell Companies in nigeria. Where did it go . This is interesting because we required intel emails which showed the highest levels in the company were in the loop. Go onnew the money would to the highest level officials yet they went on with the details anyway. Stolen goods, they did not pay the Nigerian Government and they are now being investigated in criminal investigations throughout the countries. Reinforce something. So, you have got all of this shell with the shell arrangements, right . But, what is that they are circumventing . There is a fairly clear nigerian law, correct . It was illegal for him to give himself as nigeria as minister, nigerias largest. They could not know who he was. He was the oil minister and they dealt with them for years. As though he were the private owner . Right. Than the parent structure went after an arrangement in london. We consider that to have been a because,e creation should they pay as required through the federation accounts. The money that was going into the whole of government wouldve had to be expropriated by the official process. It couldve no longer been used to pay people. That had to create an offshore system. Toi think that is the way, belabor the obvious here, with this whole thing is about is tell me if i have this right you have Nigerian Government people assets which by nigerian law, the payment for it needs to go into the federation account, which is like the federal budget, right . And they directed that payment not to go into it. That structure was created by the way in which the bill was constructed. The mechanism was created to bypass. The money was considered to be an off the back of the truck prize. So there is a question they are. This is an english expression. I apologize for that. A Bargain Basement price . Towhy would anyone want bargain a cell of price . Well, one of the things we see from in these emails is that there was a highest level discussion with an shell about how they knew there was a high likelihood the money would go on to various undetermined mechanisms to highest level officials, including johnson, who is specifically mentioned. So we have an internal discussions at high levels and they went ahead anyway. Shell shell is talking to about the fact that rather than by this asset from the nigerian people, they were going to buy it as so it were the personal property of this little Shell Company. And, by calling it the personal property of these three guys, they were able to get it wicked cheap whereas if they had had to buy it from the nigerian people, presumably the Nigerian Government would have negotiated. If it were a government acting on the behalf of its people, if it were that type of government, it wouldve put the screws into get a much higher price. It you would expect it wouldve looked after the interests of its people and sold it for the best price they could get it for. And, there are many other aspects of this that are very complicated to discuss, but in the actualy saw that someonef the asset was else. But they went through the process of trying to buy direct from malibu. Having negotiated for nearly two years and ended up concluding the detail brokered by the attorney general who used to be a lawyer. And, the arrangement they created was this offshore structure. This was not an arrangement the attorney general constructed. Designedan arrangement by the company. You been looking at well i has have Global Witness. I just wonder if you can place this story in, you know, again, you can place the story look at this in a number of other countries. Is this an aberration . Is it relatively typical . What are we dealing with in this sector . Its a fascinating case and it sounds like it will go on for a while. We will probably learn more as investigations by judicial authorities proceed. Yes, it is part of a much larger picture, as simon alluded to. Thought i would mention a couple of points of context, may, for my own reporting. Sarah was kind enough to mention private empire, its a book about exxon mobil and american foreignpolicy was the idea. I started out just to write about the geopolitics of oil in the age of constraints, the age of Climate Change, the age of increased competition, and i got out and did research and thought, i dont have a story here. I had no idea what i was getting into. I chose exxon mobil. It seemed like a good subject at the time, and so then i made a map of where exxon mobil produced its oil. I was interested in the distortions created by wealthy, Global Corporations extracting oil in very, very poor societies. Not even just developing societies. But the poorest. One of the examples was chad. They had been there, trying to develop some rather difficult landlocked oil that had difficult geological characteristics, was a long way from the ocean. Nigerias recurring scene of these kinds of crimes because nigerian oil is very appealing, its right near the ocean, its very easy to get to market, its sweet crude, and it produces well. But chads oil is difficult oil. And, chad is a very poor society, very unstable, subject coup attempts repeatedly. I flew in and i was starting to report, i drove down to the oil area, talked to people who live down there, people who worked on , governmentmpound officials, Civil Society activists. After a couple weeks i looked around and said, why is exxon mobil here . What are they doing here . I mean, they are producing a few hundred thousand barrels of oil a day in a consortium, that this is really difficult territory. Its politically unstable. Why is it necessary to be here doing this business . Theres an interesting, important answer. One of the dilemmas, at least until the shale revolution, Big Oil Companies phase was that faced is that they were producing more oil every year then they were finding. They had run out of easy oil, basically. They had run out of domestic oil, they had run out of simple oil to produce, and so they were going further and further into difficult frontiers, both difficult production frontiers like the arctic, where there were high risks, and difficult engineering challenges, but also difficult clinical frontiers. Political frontiers. Because they just needed the oil. Because every 200,000 barrels a day counted trade that was the answer as to why they were in chad. That is also why they were in which oil ginny and in other places were no reasonable company would want to do business, to be honest. In equatorial guinuea and also in other places. In places where no reasonable company would want to do business, to be honest. That pressure on global Oil Producers remains. There are Technological Breakthroughs that can take you away from Political Risk and bring you into a different kind of risk like drilling in deep water or hostile, cold climates, but thats a fundamental piece of context for this constant interaction between wealthy companies and poor societies. I want to stop you on that and say, reading private empire, this was a transformational thing for me about the book, understanding this business model. Its about proving to your shareholders that for every barrel of oil you sell, you found a new one. Because who would want to buy shares in a supermarket that only has as much milk is on teh shelf. That pressure was especially strong around the time i was working on this, but yes. Thats it. The other thing you have to understand, and im sure you run into this, and it is putting bribery cases like involving shell, and maybe more shell than any into it, into a larger context, if you look at a list of the 20 largest Oil Companies in the world, 18 of them are state owned. Owned by russian entities, by china, by india. Its an exception, exxon mobil, to be fully privately controlled to the extent that you consider exxon mobil independent of the United States, they see themselves as independent of the United States. What interesting about what simon and folks do, and we will get to this in the solutions part, the very fact that these companies are accountable to stakeholders other than governments that own them actually creates a point of leverage. They have different vulnerabilities, there have shareholders, securities and exchange commission, Civil Society groups they meet with, whereas rosner doesnt feel those pressures. Its a complicated structure to think about trying to change because you have all these privately Held Companies that feel, why are we the guinea pigs for a global government system that doesnt touch our state owned competitors. It also means theres probably quite a lot of these transactions. Summary even worse that we cannot access despite the best investigators in the world. So, i would say the u. S. , the last point i wanted to make by way of context is that i think important to say out loud that this administration, unlike the last republican administration, is actively departing from transparency as a solution to corruption in the extractive administration. Industryctive transparency initiative, which we will talk about later, is by no means a magic bullet but it is part of a suite of transparency effort that were 2000sed in the early with the support of the Bush Administration and now the Trump Administration has come in and one of its first acts of rolling back the obama era rules. To pull the plug on a transparency requirement the securities and exchange was meant to move forward and they have been signaling they are going to withdraw the United States from participation in the iti and even more advanced forms of participation than developed under the obama administration. And we will get to this. I was writing something yesterday about journalism in these times. One of the things that occurred to me, piecing through some details and this isnt surprising, maybe not that interesting. I think of the practical matter, all these rights and norms are intertwined. We tend to take them on in silos, whats happening to environmental regulation, whats happening to pressure attacks on professional journalism, whats happening to transparency. Whats happening to Civil Society, not just in this country, but in lots of other places. If you look back to the pressures on Civil Society groups like Global Witness over the last 10 years, globally, and the space in which groups like that operate, it has been narrowing quite steadily. And now it has just pivoted off a cliff. When we talk about corruption and strategies to combat it, and the extractives, looking at the next 3 or 4 years, you have to place the question in context of a general repudiation by the United States government of a whole series of comparable to transparency. This is a real departure, a departure, just to put a punctuation mark on it, its a departure from the republican partys conspiracy. We are to circle back on a number of these points. Youve done some work on mobile exxon mobil in nigeria, havent you . What have you been working on . Its important to detain in which the oil industry thats what i wanted to get that. Youre on the receiving end of a lot of these practices. Tell us what it feels like to be working with people who are on the ground where this extraction is taking place. I get a little bit worried, listening to the United States is actually pushing around the area of transparency and accountability. Coming from a background where you have seen the capacity of very key sectors, operating a colony operating like a criminal enterprise, thats majorly about the key 5 Oil Companies operated around the world, sometimes nondeclaration of the leasing of this oil. This is a country where it is possible for 200,000 barrels of crude oil to disappear on a daily basis, either to the sea or the port. What does that look like . Can you help us picture, imagine what does it look like on the ground, and how is it possible for 200,000 barrels of oil just to walk away . It is so possible. We also need to understand is how you would also link with chevron in chad, what is the connection . And, the level of corruption with countries, you would see the recent report showing nigeria, south africa, one of the leading countries actually affected within african culture. It is not only about those countries on the ground, or characters. It is about also the conspiracy that involves not only those but also the banks. A very includes other forces. Even sometimes the embassies. And at a part of philadelphia in within thestates, period of 2011 and 2014, crude iol was about 12 billion. Actually was underreported or none reported, moved from nigeria to the port of philadelphia. Just within that period. It is also possible because it is such a challenging situation. That the pumps and meters were not only manage but were purchased and maintained by the Oil Companies, treated by the companies, and records are kept by the Oil Companies. Andthe oil managing Company Bought by they Oil Officials is only in what is reported by the Oil Companies. So there is a period in the history of nigeria where we have the most kleptocratic leadership in that country, within the period of 2011, and it is not just about the personalities back in nigeria. It is most about the criminals that cooperate with that government. Working with companies that cause International Companies and governments. Also these characters and these companies declared nothing through the country. That is why you could see assets and properties scattered all over. At the expense of what you have in the country, you see the function of deprivation of many of those proceeds of the National Resources that are meant to provide education to these people. The migration that you see in the desert are consequences of this. The immigration issue that you see in the United States has part of theat consequences that you get to read off the pages, and it is moving beyond that. I was watching the film about and how thef innocent children, who are actually unaware you saw the circumstances of what they saw. The other died of cancer. The other died of cancer. The failure of citizens to have to take up actions with the companies, also the government officials, and some of those consequences that are predictable for many. So i want to pick up on three things just in that last sequence that i just want to see if we can drive home a little further. One was, you said assets scattered all over the place. You just went on a tour in london, right . Can you explain what you were looking at in london . Should also start with exxon mobil. When you look at the process, so you can get how some of those moneys and properties that we went looking for people dont know what you were looking for. Can you just spell it out . What were you looking at in london . The department of justice ok, former oil minister in nigeria. What were you looking at in london . We were looking at properties. When you listen to that, you understand how they actually get those moneys at the detriment of the money and the people, exxon mobil renewed its Oil Mining License in 2007 and 2009. The committee settled by the Nigerian Government to reevaluate those oil licenses. Exxon mobile to pay at about 3. 9 million. Exxon mobil said, no, this is too much. The Chinese Company came up and said, we would be willing to pay for these oil licenses. It was time for renewal. There was a negotiation. That would value the property 3. 9 billion for exxon mobile, to 2. 85 billion. If exxon is just going to pay off, and without any other commitment. But if exxon would build refineries, it would be 1. 8 billion. Between exxon mobil that was at the position when we had and that was the position. When he died, when jonathan came into office. Past president of nigeria, goodluck jonathan. Exxon mobil only 600 million. He wasnt the one who signed the deal. Sorry, people dont know all of these names. Hes talking about jonathans oil minister. Precisely. When she came, she granted press an interview, a report said, this is a dodgy deal. This is against the interest of nigeria. Deals must be counseled and we are going to do that. So another round of negotiations. She got only 80 million additional for nigeria. So exxon mobil walked away with licenses worth, according to the chinese offer, 3. 8 billion. Those are places through which many of these publicly sold as get access to this corrupt money, illicit money, and point the money to which they affect all the international markets. So, and thats let me bring that back. So youve got an extra 2 billion plus that is lost to the people of nigeria. Theres money going into pockets that are buying a bunch of nice houses in london that you just went and looked at. In the u. S. It was so interesting, the way you drew together the impacts on the involvement of an impact on our countries, the u. K. , the u. S. , the netherlands. Number one, coconspiracy, right . Number one. Number two, a lot of nice houses being bought on our property markets. Number three, the violence, right . I also looked at how this kind of corruption helped to drive people into the arms of boko haram or insurgencies in the delta area. And, you know, the flows of migration, that our answer is, right, lets build a wall of one kind or another, and i think you are suggesting that theres a connection, right, between this type of activity and people leaving home, crossing the desert, crossing the sea. Is that what you are saying . Precisely. Precisely. Lets think about and steve started this conversation on, what do we do about this in the current context . So why dont you guys, you know, in order, but interrupt each other. Simon can i Say Something about violence . I dont know if, simon, youve been to Equatorial Guinea. I went once. If youre doing honest work, thats about as many times as you can go. So, Equatorial Guinea is a very small country, used to be a spanish colony. And its capital is on an island called malabo. Exxon mobil inherited a project i guess that mobile originally developed there and by the time i went around in 2011 or so, they were producing about 500,000 barrels of oil a day. You can do the math as to what that basically all controlled by one family. You talked about how this kind of distortion induces violence, you walk around malabo island. What this looks like a giant bank waiting to be robbed by someone who can take over the palace. Because if you can control the flow of oil production, the royalties that came to the government for three days, you could fund a Swiss Bank Accounts that would keep your family wealthy for four generations. It basically induced all these speed boat attackers to come over from neighboring countries, cameron, nigeria. They would just fly into the shores of malabo, jump off their boats, and run shooting at the palace to try to take it over, even if their coup only lasted for three weeks, they could get rich. And so the government of Equatorial Guinea, because it was such a kleptocracy and such a police state, they didnt have a lot of loyalty outside of the family. So it was like having a bodyguard, a bank guard they could count on was difficult. So they hired moroccans. So they had this moroccan guard force basically controlling the president ial palace and the parliament, and people coming at it basically every six weeks, flying over on armed speedboats. It was otherworldly. You can see this in a political sense in a much larger country. The instability incited by oil wells. But that was the most vivid, almost Cartoon Version of it ive ever seen. From what you had in nigeria in the previous regime, it was free sale of stolen crude across the sea. In fact, one of the leaders of the militants came openly to tell the world that. It was not anything serious. They have the oil, they sell it, they buy with the prophets. They Even Exchange oil across the sea sorry . [inaudible] it is also the rule of law. It creates the political insecurity that you have in many of these countries because the pockets of the sale of this Natural Resources, rather that is going through the proper constitutional channels, possibly, or to the national treasury, there are individuals who appeal to all that whoever wants to cure this access on wealth. An alternative to the natural army, and create the security that you have around. [indiscernible] one other short point that his comment implies, theres a reason why oil is particularly triggers this kind of cash corruption. Its because the oil market is so liquid and so easy to make cash sales in without accountability. It is literally a liquid market. Once you get that ship out, you can start selling in the spot market and no one will ever know about the fullness of the transaction and there is no disclosure. Say, take natural gas, you got to build a pipeline between you and the customer. Its just not you cant just take 200,000 barrels and sell them in the market and get cash for it. Its a little bit more like diamonds in that way. It is something easy to smuggle but in a very big, global context. Simon, yes. I would challenge that a little bit in the sense that we were approached trying to think of the dates of this, somewhere around the movements of the emancipation, the insurgency period. At that stage, the bunkering, for stealing wholesale barges of oil, was quite substantial. Internally it was difficult to manage because people were coopted to look the other way. The volumes people were talking about then were much higher. Very small loads sold at a discount. And, anyway, we were approached by a consultant at the time who later went to work a little bit on trying to solve some of the peace issues or lack of peace issues. And when he was putting forward was, he had been approached by some Oil Companies, the issue of fingerprinting oil. Technological, leadbased Research Found sufficiently good to pinpoint to the field, in some cases i would as a failed biologist understand i would imagine once you start lots of different sources you can blend things from Different Countries and you start to lose that. One thing that was really interesting to me was that when a particular shipment went to cote divoire, it was a shipment they didnt have a contract. The administration said fine, we will sink the next ship unless you cough up the contract. So they cut out the middle people and ended up, if you like, legalizing the concession. Im really interested in what you were saying at the time, the big concern wasnt cote divoire and this refinery. It was going into i think texas, and also rotterdam. Rotterdam is the spot. It struck me that there are ways to follow where ships have come from, and there are people who absolutely know where ships have come from. It seems to beware you have discrepancies between that which is reported coming in, and that which goes out, youve got a problem. I think that countries on the receiving end can do a lot more to freeze assets at that point, so you can explain why there is this discrepancy, and youve lost the assets. So theres you have pivoted us to one of the things that we could do, so even ahead and even separate from the companies themselves publishing what they are paying, youre saying at the port, a ship comes in, documentation, where did it come from . Customs say, where is that from . I cant produce the paperwork, i shouldnt be surprised to get impounded. Why shouldnt i be able to bring in a supertanker, and thats fine . This gets into the kind of belly of the beast, but there is a kind of disconnect between the trade and the physical commodity, and it also creates lots of holes people can exploit. But i think your point is right, if theres a will, weve demonstrated in financial transactions, if you place the highest standards of responsibility on parties to a financial transaction, to know the source of the funds, to be liable to severe penalties if they allow transactions from dubious or unknown sources, you cannot create a perfect system but a much tighter system, then workarounds to engage and corrupt activity just get harder and harder and harder, and the risks go up. I would think in the commodities markets, like in the real estate markets, Global Governance hasnt really got to the first round in a comparison to financial transactions. So, you know, in the u. S. For example, there is something called suspicious activity reporting. So, if you are a clerk at a bank and a customer walks in with 7000 of cash every thursday, and you dont know where that money is coming from, the way the u. S. System works and the penalties that slow down the banks mean that the lawyers going to tell you as a clerk, you had better file a suspicious activity report, if that person doesnt have a fruit stand or some other thing. Now, it just goes to the treasury, goes into a big database, doesnt mean the criminal investigation has started, but its very rigorous and the threshold in banks for filing suspicious activity reports are relatively low. But in the u. S. , what industry do you think is exempt from filing suspicious activity report . Nah, depends on who their clients are. Real estate. Ok . That relevance in the current political setting i mean, essentially, if youre a real estate broker, you have no obligation if someone shows up with an llc and a truck full of dollars and says i want to buy an apartment in a famous mans condo building. And so, there are these huge gaps in Global Governance around these kinds of transactions. I think oil is sort of in between because you do have foreign corrupt processes. But then you have this giant spot market that is very fluid and not accountable in the same way. I would agree. What would you like to see, if you could name the first thing that youd like to see in terms of a remedy for the type of activity and behavior that youre telling us about, what would it be . International anger. Sure. Do one international, one local. I think most importantly would be the sincerity on the part of the diplomatic community, in dealing with transactions and businesses that are concerning many other countries. The oil test i mentioned is not a black market transaction. It is outspoken to the extent that many of the ships, like you said, have tracks on the water, theres a done, declaration. Theres a need to check at the point of origin and what has not been declared. What i mentioned, about 12 billion coming to the port of philadelphia alone, and to china, worth 3 billion. The gap between the declared and declaration in nigeria and whats in the port. That is what amounts to 12 billion. It is a small amount that you want to tell me the american system that [indiscernible] also, many have identified corrupt officials. Still having access to many of the western world. Whereas, citizens of the country are not granted visa because they probably cant meet certain criteria. These suepcts, even many of them are still allowed to enter into many of these countries with this money that they have come to spend in the system and pollute the system. And i think its important that this is actually reviewed by the northern countries to the extent that you dont provide and, the officials at the local level cannot also be confined to mere commcercial transactions like we have rightly observed, you have implications for not only your country, also to the safety and security of your citizens that go into thes countries. I can tell you, you talk about exxon mobil, so exxon mobil is connected to america, it is connected to americans. If you talk about shell, they can tell you it is a british and dutch company. The reputation of countries. And also the citizens. I think part of getting to that space requires that justice is done. And i want to sort of preempt this by saying im not a flog them type person. But there is little more frequently than the cost of doing business consequence is. And that is if anyone actually knows about it. In this case, we spent five years investigating this. We filed complaints in six jurisdictions, now. Based on the evidence weve obtained, sure, there are procedures going by and we will see whether the judicial authorities get to. And lets hope that things can go forward. I cant say much more on that because i think its down to prove itself. Think of the hsbc case. I dont know the extent in which people are familiar with that, but hsbc one of the findings that came out of the investigation into hsbcs mexico operations, was that the boss of hsbc was informed by the boss of hsbc mexico about the enlargement of teller windows in the branches in mexico in which drug cartel money was being paid in extralarge suitcases. So, you can imagine. Anyway, he was personally informed about this. Nothing happened. The end consequence, yeah, there was a 1. 9 billion fine. I think we worked that out if you divide this by 10 years of criminal activity, because there were other crimes as well, it comes to 23 days profit and nobody goes to jail. The u. K. Boss of hsbc went on to become our very own trade minister. To this day, the worst that happened to him was he spent a day being harassed by channel 4 news who asked him some of these questions. He basically said, im not commenting. My point is, im not interested in people going into jail and so on but unless you put people who are ultimately responsible for these kinds of activities, and lets face it, the seven years they wanted this money, 50,000 people were killed, i think theres a real complicity, culpability problem that people get away with and theres no disincentive not to repeat. Both eni and shell were subject to the prosecution agreement with the doj for previous Corruption Cases in nigeria, while their most Senior Management were engaged personally involved in the construction of the next corrupt deal. I even went to the agm a few years ago where the previous ceo was still in power. He even spent a whole 10minute period boasting about the agreement process. They had this great system of checks and balances and he was the chair of the committee that ran it. While that was going on, he was involved and he knew. What is that about . Where is the consequence . They paid a fine and that was the end of it. Let me ask you a question. We do also want to talk a little bit about the domestic Political Climate that allows for some of this, but i might solicit some questions from you guys in that vein, if any is interested in that. But before we get there simon, you been doing this for a long time. I mean, i suppose we would probably all say that if you want to fix this or struggle against this effectively, because you will never fix it completely, but if you want to be effective, you will have to take some kind of an all of the above strategy. And you can evaluate the effectiveness or the relative value of different attempts, whether they are institutions tactics Like Justice Department whether they are institutions like eiti or theyre tactics Like Justice Department cases or bringing complaints. Big picture, after all these years, when you think about the role of Civil Society groups, you think about the role of local citizens developing their own campaigns for transparency on behalf of their own citizens, when you think about transparency initiatives that are multistakeholder, when you think about government prosecutions and going to jail, consequences, what do you think has been the most effective strategy what is the area that time and again moves the needle . My answer for that is there is no singular answer. We need transparency. As a revenue flows, we need to see the revenue flow disclosure down to a sufficiently granular level. So for example, shell is aiming at accounting directives work, this is the eu answer to this doddfrank you mentioned earlier. They wanted to have magic level disclosure to find concessions in nigeria. When you have a singular big figure payment, you cant say anything. Completely irrelevant data. We can already work that out, more or less. A crude calculation. Its meaningless. You need to have granularity around disclosure. You need consequence. You need budgetary oversight in terms of in country and outside her you need to look at the role of the banks in providing backup loans. One specialty was taking oil and pledging it through a consortium of banks in london. They would raise billions of dollars, then loot it. There was no oversight over that. You need banks to properly know who their customers are. How often have we seen a collapse, and within days we know, he had a bank account here and a bank account there. You dont uncover that stuff in five seconds. People know. These systems are not operational in an effective way. We need the cumulative whole. I think what steve was getting at is, have you in your efforts to push on some of these levers, have you seen one thats actually provoked a reaction from the industry . Have you seen anything . What makes people the most responsive . Jail, i suppose. I was just going to say, i think the fact that exxon has been relentless in undermining section 1504 of doddfrank shows they have something to hide and those transparency rules have from Global Witness, too. I saw her gesturing, trying to send the word. Before you jumped in there, thats where i was going with this. I dont think disclosure alone is enough. Im simply saying we need a consortium of things. To the point of that disclosure, the doddfrank past, in june 2010, there have been two rules created by the fcc that would have required project level disclosure. Weve seen a panoply of reasons why from the industry side why this is too expensive, it doesnt work, its impossible to manage. There have been litigation efforts that set aside the first rule, the Public Record that justified the second rule was incredibly large. And so we ended up with a rule not only that, we had a rule that was fit for purpose, which was not only parallel if i theres a Global Movement out there creating disclosure around these payments. But if i come back to what you were just saying, is it that they think such disclosure will expose them for involvement in corrupt practices in countries where if you go back to my earlier point, countries where my supposition after 20 years has shown me the concession that it isnt corrupt as opposed to the other way around, or is it maintain aish to corrupt, opaque environment. To illustrate this, the first rule within the timeframe that know that fec we was politically impossible. But had it been done like the haved rule, it would been in place 10 days need for this deal was constructed. Does anyone here think shell wouldve paid 1 billion bond, what it basically amounts to, to the highest level officials and nigeria if they had to disclose of that payment . I dont think the answer to that would be correct. I think that they would come up with a different construction and what they shouldve done is said take it off the guys who stole it and put it up for auction and bid. They did not do it because they knew it would be covered up. That was a mistake because the middle guy who helped of them got ripped off. That is the environmental we are in and trying to change. I think we really have to look at the second rule. What happened and why . I do see frank back there but i am not going to you first. I will go right here. Thank you. Michael, retired from the department and aquaculture. Department of agriculture. The question here is about exxon mobil. We have the chairman of exxon mobil. Is there some lack of transparency, something we do not know. Investigatingk to Rex Tillerson and others like him . Thank you. Coupledont we take a questions. Right here, sir. Also in front and then we will go back. Say it again . Ken meyer. I believe when chad began producing oil, the money was placed in a trust fund. In the government of chad had to request money from it. To justify what they were going to do with it. How did that work out . And one more, further back. For the vocal, right here in the middle of the aisle. Yes. My name is frank vogel and Item Associated with a group called amnesty international. Think it is remarkable that on thetice department 14th of july announced a civil complaint against two nigerian businessmen and this country for an apartment in the middle of millionn and an 18 yacht. It was about the same time it was paid millions of dollars to buy real estate in and around london. The interesting thing is the fbi inon of interest in going to civil forfeiture. Chasing the money all the way to the United States as a way of of theg the crimes corporations. I think that is a major change. But, my question to you is i have a sense maybe i am wrong. But many of us focused too much on corporations and the hybrid sector and not enough on statehood. Ther it is petra brock petrobras or other companies, the skill of engagements of corruption. It seems to be absolutely massive and we have not done nearly enough to focus on it or find solutions. I am very interested in your comments on that because i think the scale of the money we are dwarvesabout absolutely the bribes we are being being paid, no matter how large they are. Do you want to fill those in those three . I will take the second. You are right to recall that when the oil and chad was first developed, there was a compact involving the world bank and i think citibank in a london and the Consortium Members were producing the oil through payments through a trust fund that would be allocated to ministries for social development, education, public health. Long story short, the compact broke down under pressures when the government was attacked from sudan, he felt that he had an existential crisis. He was at that point producing enough oil and receiving hundreds of millions of dollars in road to use he had leverage he did not have at the beginning. He wiggled his way out of it. The thing that was so striking at that time was a snapshot of what these consortiums feel like. So, at the time, he viewed the americans to help him get out of the box he put himself in, u. S. Embassy in the capital probably allocated through different departments about 10 million in aid to the country of chad. One of the poorest in the world, bottom at the Human Development index tables. About 10 million a year is what the government spent in chad. Exxon mobil, a royalty check with 600 million to his government. If you wonder was at the power of the United States is in your country, it is not the marines guarding the embassy spending a few Million Dollars on agriculture and another on terrorism training but the private company that writes a check for 600 million a year. That is how you get out of a compact that involves a relatively weak institutional like the world bank. Sarah this is an important point, when you are, i left in afghanistan for a long time and i was not particularly impressed by president karzai. At one point, i thought if you are getting 18 different signals from the United States of america, if you are president karzai, you have to pick who is it that speaks for the United States of america. These guys will make those decisions on the basis of calculations like this if they are really, really part factors. Just important factors. Do you want to speak to the tillerson question . Steve he is also a subject of the book so i would direct you is there. I am curious about, i think there are two chapters of his history as a chief executive. You do not know as much now as we will probably eventually. One involves a fine that the Trump Administrations Treasury Department entered into against exxon mobil in which exxon mobil has now decided to litigate against. Whatever the back story about this allegation of willful violation and sanctions on russia and the Framework Agreement and production agreements in russia. That is an area that will be interesting. It means that, of course, they want to defend the reputation, but it also means that a lot of information slightly to come out during the course about the back story. As a journalist, im interested in that. Another thing is this long, tangled history of exxon mobil and Climate Change and particularly the era it was funding commissions by nonscientists around early 2000. And now there is litigation is that has popped up here and there which is seems to be a whole series of back channel emails the between the chief executive and others, not quite clear that it did not come out in the initial discovery but which now has been discovered and what the content of the emails are. It is something im very curious to watch. Sarah i would like to come in and say there is a more conceptual issue that is of grave concern to all of us. I have been looking at how hypotheses are structured, the networks structure of governments is an integrated network in which public and private sector come to overlap where you have the identity People Holding positions in a separate sector or they are proxy servers or exchanges, quid pro quo that ties in the network together. I mean, i have to say i looked at that appointment and i said in my looking at honduras or the United States of america . The degree of overlap of functional overlap between the top reaches of a very tight group. This is not the shoemaker or the baker, the current president of france has brought a lot of Small Business people into his government. We are not talking about the local shoe maker but a very significant private sector element. One of the things that has been apparent if someone alluded to earlier in of the conversation about how exxon and chevron have been very reluctant in the u. S. Process is so much so we are in interesting moment where will the u. S. Failed validation should it come forward to validate and the supposition it wouldve failed validation. Whose fault is that . Theres been a consistent history of opposition from the two countries from having meaningful discussion whatsoever and it is one of the things i find quite interesting. The first country to be followed data, delivering. To be validated and successfully delivering. Played a key role in ensuring unlike in nigeria where there was project disclosure of a sort and it was a macro figure of the whole country. This was a force of the standard at the time which has been tightened up. I come to the point there is a history of absolute opposition particularly from exxon to the conclusion of dodd frank 1504 at opposition or through the creation of the rulemaking processes and so on. And my impression from my sources is that it a radically opposed to 1504 coming to place. And i think it is very interesting that the use of the cra resolution sarah chayes cra . Simon congressional review act. The first one was a Legal Process which ended up with the world, the first world created by the banks satisfied of the Legal Process. The sec then opened up to a Public Record process at substantial public Public Records created. I think if they try to litigate that, if they try because it was continued oppositional, it would have been a serious fight and i do not necessarily think they think they could win. It was a solid rule they fit a purpose and the evidence supported that. What do they do . They had Congress Take a dow. That was, in my view, that comment from a fellow who comes, what of the most shameful acts of democracy, of a democratic process i have ever seen. The arguments put forward to take it down, the use of them over the last 70 years which were thrown out about 17 years which were thrown out. They do not stack up. The opposition came back and said, this does not count. People put forward the arguments. They debated to hear the counterarguments and then the vote. Voted along party lines. It was just a majority has a vote, bingo, finished. Taken down. Sarah do you want to pick up on some of the questions . Olarenwaju i think he is not a lost on many of us from nigeria on the nomination. For the moral challenge United States . Olarenwaju yes, because now we remember the bribery case, dick cheney was also vp of halliburton. Now with the involvement of chevron and do some of the shady deals that were talking about, which is theres no way you can tell the International Office from the National Office and evolving renewal of oil license and operating positions. Rex tillerson was more or less like what we experienced where you had a dick cheney as the Vice President and involvement with halliburton. I wanted to respond to the question about the oil industry. The Oil Management companies of high risk countries. Sarah the national Oil Companies . Olarenwaju yes. The problem is not to continuously devalue, it is for us to change it. It is to quickly, clearly, there is no way [inaudible] if you want to continue, be responsible for corruption there. You are also blaming the victims sometimes twice. Let me give you an example. Many of iocs come to these nationalized Oil Companies and they have rules and place. And the candidates and they [indiscernible] you will march through this process. The current minister in nigeria, exxon mobil [indiscernible] when the oil mine licensed were renewed, he had it like 25 years. He was there through the process. You know for sure he is not going to build their to protect the interests of mobil. You are not going to get to the root of many of these crisis. It needs to change so when were talking about corruption, not only talking about people corrupt but [indiscernible] sarah thank you. One here, one there. You didnt . Careful. [laughter] my name is hillary hurd. Work for an Transparency International defense firm. I have a two point question. How has the drop in Commodity Prices have affected opportunities for corruption in nigeria and how has it the insurgency against boko haram has hurt other sectors most notably defense . Good afternoon. I wanted to ask to speak to some the Financial Institutions wittingly or unwittingly looking that these transactions, how to help with transparency and understanding some mechanisms that you mentioned are only available if a u. S. Institution is a somewhere involved in that. Sarah i thought i saw one there. Thank you. My name is kelly troutman. Im with oil change international. My question is to the implications of Climate Change. Research shows that there are, the potential emissions already operating gas c and and coal can take us above warming below two degrees celsius and expansion of Oil Industries are ultimately incompatible with a set of climate under that context. How do you see financial transparency or [inaudible] transparency around Oil Reduction in climate risk . And given at adjusting climate, managing the phaseout of the oil industry within the next three to four decades are realistically, how does that play into reducing corruption . Obviously, a smaller oil industry that cannot expand into reserves and how does sarah i think we have got it. Thanks a lot. Super. That is going to have to wrap it up with the answers to those three excellent questions. You want to start with security . Olarenwaju is a very unfortunate situation that we have to go through what actually started, very unfortunate political orchestrated conflict by what was the most irresponsible government we ever had in nigeria. This probably would be your normal understanding for boko haram. Boko haram, like i said, was not anything close to a remedial issue, do not have any [indiscernible] against practices are evil i understand to a very large extent what is expected of the religion cult. But for the purposes of therstanding and also [indiscernible] he needed to whip up the Political Sentiment to emerge as 2011resident during the election so there was a whole [indiscernible] rpesidencyun for the whole boko haram thing started as a joke and many particularly because of the level of the fiath it was to buy intor them the argument. [indiscernible] you would ask yourself, would you want to fight to stop it doesnt make sense. Sarah the substance of the question went to something you said, to some extent, there is robbing of the resources is fueling the kind of violence that the boko haram represents or men represent. Can you drive connection between the subject of this conversation and the violence and the north and the south . Olarenwaju to give that, if you do not understand it, you would probably be going with a previous notion that this is a geopolitical crisis. It is not a religious crisis, it is political at it is actually designed by people who were within the corrupt agenda government. There was a need to get away from the crisis going in that structure. And for them to it was this bad [indiscernible] we are killing the military. They were captured by whole boko haram. Before the advent of this i did report recently on monitoring of repatriation that was field. I couldnt help but see the level of violence on those communities. The fight because boko haram which is a new commitment. Fighting against, all of the local governments taken aback from boko haram. It becomes just like iraq. Carries out bombings and not the usual confronting the military like we had before. The level of corruption that went into defense and luckily, this is becoming the political Financial Commission investigation and of the contracts. It showed wall of the war while the war to fight, it was going to the private pockets and were finding, from nigeria, it was owned and actually impounded in south africa with a huge, hundreds of millions of dollars which was claimed to be made by the procurement. You must ask how do you go by buying arms with no cash . This level of of improvement. That is also, i should also say that even in the u. S. , there are about 4 billion, money from the military government that is still within banks in the United States. These are the hugest situations that feels not only the crisis but creates a divisions. Suicideage in the bombings. [indiscernible] sarah would you take the Climate Change . Steve it is a big question and important. The future of the oil industry as a growing concern and the value attributed to Oil Companies with reserves probably a function to a great extent in the timeline you are thinking about like the decades long struggle to prevent temperature rise above two degrees celsius, probably a function of whether or not electric vehicles emerge as a dominant Transportation System around the world. Exxon mobil has been a long time planning for disruptive technologies. Threats to their industry. The one that got to them, at the time i was reporting and writing a book, the one that got their attention was the possibility of a very fast pivot to electric vehicles. Its a transportation fuel. The future of electricity does not implicate the oil industry the way it does because of the natural gas upon it. A gas of exxon is about only half of oil. Half of it is a Natural Gas Company now. I think we live in a world of Market Forces and powerful corporations and big, long term capital investments. The being realistic, the positive consequence to shift will flow partly for whether or not theres a positive innovation to cleaner transportation. On the electricity side, i think it is a matter that despite the Trump Administration that the coal industry, they are delaying their decline. There are not going to be rescued. Natural gas is certainly going to be part of a mix that is a whole other set of subjects. But it goes back to this question of where pressure points are. The difference between them and manufactures of tennis shoes or copy is that they are primarily not a consumer business. They really dont care about Public Opinion. Yes, there is a brand on the gas station where you fill in their tank but you can go across the street and fill up somewhere else, what difference does it make . You have to fill up your tank with gas. So it is a different set of pressures required to move these problems and the last thing i would say about Public Opinion is that on climate and how urgent the Climate Risks are and whether or not we are willing to pay a price to address those risks, we are the United States. The question is settled everywhere else. Isolatewe withdraw and ourselves, we are not going to change World Opinion and American Opinion will eventually catch up with the rest of the world. It is a strange anomaly. The two that have managed to compute confuse our public. Do you want to wind us up . I think there is a great deal that is going fast and onwards. I totally agree with what you just said but it struck me that part of the solution to arriving at electrification constructs that would work come down to the investment level. If you have invested like there was no tomorrow, like there was really no tomorrow, you might put a finger out and put some Natural Resources and. If i gave it to you and give you the worlds best and said, you have five years to put your finger out and give as the innovations to do this and issues, this, storage blah blah blah. I think it comes down to we the people. Orre is a question of legal illegal. If you ask the question, you know, we won me argument about revenue dysplasia in 2003. So what the hell are we still talking about it for . The reason is the industry at the political level. Despite some very brave people, some of whom are in this room, who are willing to take the leap and push the position. Have leadership, disclosure methods for the rest of the world to follow. Now abrogating on it. A weighty there is country needs to see things in this case and get our leadership to go back. We face in existential crisis. Or we going to let them get away with it . On a risk disclosure, how many of the assets if there was a policy and that is where it comes back to capturing the space. There will not be a policy unless we kept her that space. They can no longer rollout that there will not be a policy which implies you no longer can say, i can guarantee this deal i am about to go into has a likes and that is viable for the next 20 years or whatever. Whether it is a growing amount of the ca resolution which i talked about. For project level disclosure, why should we not have Climate Risk Disclosure on a projectbyproject basis . So people should know, is in a country like nigeria or another country like uganda who is just embarking on an oil field future. Whether you would want to put up with pollution, for example, as a possible biproduct of going ahead because you are being sold this line that you are going to create development dollars. Lets say we are breaking prices, say 70. I have no idea. Getting it to the coast, the geography is difficult to the cost goes up. If we have Climate Action that delivers, it is the beginning of a new regime of electrification pickles. It will go down even if the u. S. Does not do anything. The demand will go down. Theprice will crash and price will carry on going down and others will increase and it will be wiped out. So then we ask the question, is more about the bonus that the leadership of the company will get from booking and the prospect of being able to pillage some of the money if you are a corrupt leader on the other side, or is it actually and economically viable project . So if you think it is economically viable, then disclose that. So we need a government that will tell us projectbyproject is economically viable under a or twonce of one degrees. I think will find a substantial number of projects are not economically viable. Meaning a risk to investors. At to your point about leverage. Investors in these companies. This is going on now to some extent because there are for example, accounting parts of companies as to whether or not they are properly written down the value of fields, for example. This is an area where people are a push where it is a bit of a selfimplosion a year ago. There was a push to improve the standard of the iti. Would it bring in Climate Risk Disclosure . Is rmation what is iti . This is a multistakeholder initiative which involves companies at the table. There was this flip out and the anretary of the iti produced alternative to the letters sent in. The letter was extremely wellarticulated. The response was utterly inadequate. It was simply the biggest bully. The block saying no is not finished. This is going to come back and go to researchers. These debates will continue. It is the beginning of the Global Project level disclosure mechanism which i think has every possibility of requiring ultimately climate risk benefits for investors and citizens. Thats with that, ladies and gentlemen. Applause] thank you. We have a light meal outside afterwards and we can be her for just a couple of minutes. We have to then go record something very quickly. [indiscernible conversation] tonight i q a. The social and legal response lockat blacks have is to us up and put us in cages. To stop and frisk us, to treat us as citizens whose rights are not respected. We are not whole citizens of the United States. Lets a georgetown law professor takes a critical look at the u. S. Criminal Justice System and the impact on African American men in his book grade. There has never been a time when it hasnt been anywhere near good. For a long time and you are a black person you called the police to report a crime if you are the victim the police did not pay that much attention to it. Now this sense is that the police are overwhelmingly in africanamerican communities what not to protect the communities or two lock people up. Monday night on the communicators. At the black hat conference and las vegas talking about Cyber Security and Cyber Threats with the ceo of net square. We will keep on patching it months after months. Aboutwe have to think defense. We cannot keep reacting to a tax anymore. Traps, we have to engage in threat hunting. Watch the communicators on cspan two