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NextGen Magazine


Study: Turkmenistan Most Corrupt Country in World

Chris Gaetano
Published Date:
Apr 10, 2019

Consulting firm Risk Advisory, after ranking nations through its Corruption Challenge Index, has concluded that the central Asian nation of Turkmenistan is the most corrupt country on earth. Due diligence experts from the firm's seven regional business intelligence teams compiled the index, with the firm's political and security risk focused Intelligence & Analysis team doing the scoring. The experts were asked to grade each country on the likelihood of two scenarios; 1) foreign investors encountering corruption in seeking a significant government contract, license or permit, and 2) a business operating locally enduring small-scale official corruption to undertake day-to-day operations. These scores were added to a regime stability score to arrive at a Corruption Threat rating (T). This was offset against an Opacity score (O), which was based on the experts’ assessments of the comprehensiveness and reliability of public information, media openness, the freedom of human sources to converse, and particular linguistic barriers such as transliteration or complex translation. The Corruption Challenge score (C) subtracts Opacity (O) from Corruption Threat (T). So, essentially, C = T – O.

Using this scale, Turkmenistan had a score of 51, which means that if you have a client investing in the country it might be good to brush up on your FCPA rules. Following closely behind were Somalia, with a score of 49, and Libya, with a score of 48. The three lowest-scoring countries appear to be Australia, at 12; the Republic of Ireland, at 11; and New Zealand, at 10. The United States scored 16, and Canada scored 17. 

Corruption, being illegal, often involves money laundering to hide the source of the illicit proceeds. If you're interested in how criminals move their money around and the efforts to stop it, you can register for the Foundation for Accounting Education's upcoming Anti-Money Laundering Conference, scheduled for Nov. 20.