Good morning, everybody. Welcome. Im a Senior Advisor here at the csis. Its good to see lots of Friendly Faces in the audience. For those of you new to the headquarters, i know some of our panelists, this is their inaugural visit, welcome. After the session, we will be having a reception. We hope you can join us. Welcome, again. We are being joined via wide stream on internet as well as cspan. Keep in mind youre on tv as well as we are. But were very excited to not only be hosting this pooanel entitled assets. I could not imagine a better set of experts to speak to the range of past, current and future i e issues and challenges. Let me set the stage, in part, because weve gathered about two years ago. In what was happening systemically in terms of dealing with highend corruption. These issues are not new, of course. News a these are issues and regimes that will be with us for a number of years. What we want to do today is talk about an International Community in the u. S. On dealing with Asset Recovery. In particular, in the wage of the spring and some of the disappointment disappointments, in the wax of the transition in ukraine and in light of some of the recent cases in particular bought ear e here many the u. S. So thats what we wanted to do today. Have an open discushion e cushion. Well speak for about an hour and then open it up for questions. To my left is ambassador zelwegger, a very good friend of mine. Legal advisor in essence in charge of the Asset Recovery. To his left is the section scheef. Jay is the general on Asset Recovery for the u. S. Government. Running now for the department of justice just in the past couple of weeks. Jay has deep experience. I wont give you his deep background because its em barszing how impressive it is. But he is the u. S. Expert on these issues. To his left, youll have to forgift e give me his last name. The center piece of the world ba banks efforts in technical and asset issues. A long standing profusely on these issues and a world recognized expertment you do have three of the worlds experts. Im here to be a moderator and hopefully will drive the discussion in an appropriate way. From your perspective, what has gone wrong . And what are tissues at large i the International Community. Thats a good question. A lot has happened. The most important thing is that Asset Recovery is now very much on the forefront of international news. Switzerland started to be proactive. For a long time, a lot 06 cases were swiss cases. We did so because we were under pressure. Not only did we have one person, but we talked about the groups. 3040 in these countries. So the cases are much more complex. The most important change is there is a recommendation. Also in the financial sectors, so to speak in the north that we have to work together. We have several International Recoveries that are initiatives to cooperate among all requested and requesting jurisdiction, which means all the partners involved, weve never had that in the past. Weve always tried to solve cases bilaterally. What we do at the time, we all work very koesly together with the support of the world baeng. And i think that is an extremely important developmented. And now they come to your point that we have not made the progress we hoped for. I disagree with that. We shouldnt have hoped for more progress two years ago. And when i dont remember exactly whether we hoped for more progress. Thats still one of the remaining charges. If you look now at some of the progress weve made, within 2011, within 3 1 2 years. Sending back twothirds of the funds we have to tunisia. We have rapid procedures, the quickest case in our history took us five years. We were efficient because we had a cooperation with nigh year ya in that case. Now, in tunisia, we solved the case in three years. I think that is also due to an International Cooperation. We could solve the case because we have a close cooperation with tunisia, and, also, because we worked with other jurisdictions. And in order to collect all the information that we need, thats the best approach. So i am pretty confident for two reasons. Asset recovery is not a topic on the International Agenda and, second, International Cooperation has increased over the past two years. Youre talking about an issue right now. Its not seen as just an issue on effective countries. That its now an issue for the banking cent eers and the west many cases. Its interesting, talking about the issue, we do know that in the context of the spring, there are hujs funds in Southern Financial centers. Can you speak to the shift in the u. S. Approach and maybe take e take us through this latest case which has gotten so much attention with the seizure, the malibu mansion and the Michael Jackson statues and the rest. Sure. I think its important to recognize that theres been a shift, but its probably been a shift more in emphasis than in desire. You know, the efforts to recover stolen assets on the u. S. Side, as it goes back many years. To the 90s. I think what changed about four or five years ago was a concerted effort on the part of the u. S. Government to devote resources and expertise in a core of prosecutors in these type of cases. The attorney general going on four years launched the recovery initiative. I think that was a recognition that at least with the legal system that were working within the United States, Asset Recovery is a judicial procedure. Those arent 5 00 sets that can lead to recovery of also sets. It prevents assets from flowing to the affected countries. But we cant use that as a mechanism and then return those stolen assets. So in the u. S. , thats done through our forfeitture laws. Predom nantly, were dealing with situations where the individuals who are responsible for misappropriating these also sets might be outside of a criminal process. That is either a legal matter or a practical matter. So we focus on the United States of civil forfeitture where we have to tie the asset to the crime. You have to tie the asset to the crime and that requires sophisticated financial investigations where we can trace money that emanated from a corrupt act to the asset. Proving that case takes specific everyday. The crime seen, if you will, is the crime scene in which it occurred. You may have to get witnesses from third Party Countries who might be willing to talk to you. You might have to get financial records. A cooperation thats improved tremendously over the past few years. We still have issues in financial records that can be admitted in court. I think with the rise in some of the data policies, they have valuable aspects from a personal privacy point of view. They make it difficult at times to get the Financial Information we need to prosecute these cases. And then you have to put it all together and produce a judge that these are valid cases to be brought and should result in a forfeitture judgment. And then youve got some of the Politics Around it. You know. People question whether forfeitture is a useful tool. For me, i would say yes. Its one of the most valuable tools we have to attack corruption. And criminal conduct. All of that is a long way of saying that we couldnt do this in the ugs with people doing it par time. And we have a lot of prosecutors who ared otr types of cases. What were talking about are really sometimes criminal organizations that masquerade as governments but are really exappropriating also sets for the betterment of themselves. So you need the skills of an organized crime prosecutor, courtroom skills. So you 23450needed to get sophisticated, trained people to do this . The people that we have to go up against are some of the best of the best. Right now, the department has devoted testimony prosecutors to the clep tok ra sill unit in my section who work exe exclusively on these cases. We can now respond to events on the ground as opposed to going back 15, 20 years and trying to piece together the puzzle. That makes a huge difference. I think really whats changed is a reck nigsz e in addition of what it will take to win these cases. It takes a while. A number of years ago, pretty much fairly soon after the initiative was announced. But were dealing with a government that was not cooperating, with evidence that was largely low kated in 2 country. Financial records that had to be obtained and pieced together through a web of complex shell corporations that hid the true ownership of these. At the end of the day, assets that we might not be able to get our hands on. At the end of the day, the settlement is that we managed to sishlly forfit or acquire through other means the value of all of the assets that weve the potential of getting. This is an understanding that, if for some reason, comes back into the country, we will reserve the right to go after it. But i think we shouldnt underist underestimate how difficult a job this is. It doesnt do us any good if we acquire these goods in a way na vie lates that due process. That takes time. It can fris rate you, i can tell you, from the perspective of a prosecutor. But then theres publy lick wilein. Theres le jit ma sill. We lose some, we win some. I think that, in and of itself, is a very important lesson to countries emerging from different types of political circumstances. Well come back for some interesting lessons from that, of course. Talk to us about sort of the evolving world bankroll because the Star Initiative is relatively new. And sort of talk to us about that 679 and talk to us, particularly from your perspective, what you see in the landscape. More resours. Whats your perspective on all of this . Thank you. I im ill just give you a bit of a background. Real really, to put in practice chapt ere 5 of the United Nations convention. Chapter 5 is on Asset Recovery and lays down the principle that countries will return the proceeds of corruption back to the Financial Centers where we turn back to the countries that have settled from corruption. And we do that in a number of ways. We started off very much, i think, on the more policylevel advocacy level, trying to put Asset Recovery on the map. Did a big, Asset Recovery handbook. Trying to do a bit of advocacy, as well. To breakthrough those barriers, trying on the topic which we just touched on right now to push the epnvelope on beneficia ownership and make the countries aware of the misuse being made. And, again, thats not a new issue. Deserves high lighting of the misuse both on shore and offshore jurisdictions. So we started very much trying to sort of push policymakers. I think in the wake of the arab spring and now after the events in the ukraine, we become more focused, also, on really working drektly with countries together. Building capacity. How one reaches out. What are the typical conditions for mutual assistance. Legal assistance, how do you draft a mutual legal assistance, really basic step by step stuff. And also and the arab forum on Asset Recovery is one of the examples of that. And as was the Ukraine Forum on Asset Recovery. Trying to provide a bit of a venue, a bit of a neutral venue, where requesting and requested states can meet and discuss the issue of trust is very fundamental, i think, to successful Asset Recovery. The issue of trust is very fundamental, i think, to successful Asset Recovery. The issue of trust is very fundamental, i think, to successful Asset Recovery. Issue of trust is very fundamental, i think, to successful asset recover issue of trust is very fundamental, i think, to successful asset recoverissue o fundamental, i think, to successful Asset Recovery. Certainly if you look the at the issues just after the arab spring there was perception in some of the countries, well, if these Financial Centers were happy taking the proceeds of our former rulers, why should we trust them now . Why would we work with them now . Why would they help us . So trying to, on both sides, act as an honest broker and bring the parties together i think has been an increasing part of the role of the stolen Asset Recovery initiative. And so its with that sort of perspective when you ask me to highlight some of the issues. If you look at the landscape i think was your term of Asset Recovery, its through that lens that we look at it. First point to the ambassadors point, absolutely, the attention given to Asset Recovery is is spiked enormously. Various factors i think contribute. There is the United Nations convention against corruption and that spree into force and i think thats done a lot. I think the financial crisis has helped particularly fiscal authorities zero in on the abuse of Shell Companies for all sorts of purposes. And i think that is in no small measure contributed to the push on Beneficial Ownership. And i think Civil Society. I see some Civil Society here as well has contributed in no small measure. So i think for a variety of reasons we are we are now seeing increased attention at the political level and at the t20 and elsewhere on the issue of Asset Recovery. Thats not just words, thats not just paying lip service. Thats also putting in place the sort of task forces that jay was talking about just now. The unit is an excellent example. The unit that ambassador zellweger referred to earlier. You didnt refer to it in so many board are words but it was what you were pointing towards. In the uk, in the met police, funded by the way for the department of International Development which i think is a very interesting funding model. Where you have a number of dedicated Police Officers this is then the uk example specifically focusing on the proceeds of foreign corruption in the london finance system. Those sort of things and sometimes its in a formalized Asset Recovery unit, sometimes its just about breaking down the boundaries between parts of government that used to maybe work too much in silo, you know. The Financial Intelligence unit maybe wasnt really connected to the anticorruption unit, which in turn may be not have been plugged into what the regulators were doing. I think breaking down those boundaries between different parts of government is very much something that weve seen and its translated into legislative action as well. You spoke about the sanctions regulations, asset freezing legislation that many countries have adopted. So a holding measure. Eu has done that, switzerland has done that. Just after arab spring. A list of these persons, freeze their assets now. So its not a judicial freeze in the context of judicial action. Its an administrative freeze giving the countries time to prepare their judicial action. I think that sort of innovative legislation is happening. The civil forfeiture legislation that i think in america has been around for a very long time but to many other countries is still relatively new. You see that i wouldnt say proliferating but you see countries taking up those sort of legislations. So what we call nonconvictionbased legislation where you connect the asset to a crime. Typically on the balance of probabilities. Wont go into too many Technical Details but any life way, looking at legislative action to make it easier for a country to get to stolen assets, the proceeds of corruption. I think those are all very positive, positive developments. Of course, there are still challenges. If we look at the start of an Asset Recovery initiative we have databased the Asset Recovery watch where we try and track international Asset Recovery efforts. And i think at this stage, i looked at it yesterday, i think actual returns so far, were at 4. 9 billion. I think were at 27. 7 billion in frozen assets. And so lets say were in total at maybe 8 billion or a bit above. If you look at the whole landscape of asset of corruption, 8 billion is maybe not a whole lot. But ambassador zellweger made a very good point. Maybe we put too much burden on the system of Asset Recovery. Maybe were expecting too much to happen in the context of Asset Recovery, which is, as jay just said, after all, a judicial process. You soon overburden it and put all your hopes in we can do it that way. Maybe there are other things that should be looked at as well. One of the challenges that comes up, and it slightly relates to the point of civil Asset Recovery that jay made earlier, precisely this point of linking an asset in a Financial Center to a particular crime in a corrupt or autocratic state. Certainly if youve had regimes in place for 20, 30 years, how are you going to do that . How are you going to say this bank account or this particular house was bought with assets that we can trace back all the way back to a bribe paid thats extraordinarily thats an extraordinarily high level of you know, thats a very high burden youre putting on a