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legal instrument for prosecuting corruption, the US Foreign Corruption Practices Act (FCPA), is also a factor. ...... corrugated iron sheets donated to a school in ...
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U4 ISSUE February 2017 No 3

Preventing corruption in community mineral beneficiation schemes Dr Michael Nest

AntiCorruption Resource Centre www.U4.no

U4 is a web-based resource centre for development practitioners who wish to effectively address corruption challenges in their work. U4 is operated by the Chr. Michelsen Institute (CMI) – an independent centre for research on international development and policy – and is funded by the DFAT (Australia), Danida (Denmark), DFID (UK), BMZ (Germany), Norad (Norway), SDC (Switzerland), Sida (Sweden) and the Ministry for Foreign Affairs of Finland. All views expressed in this Issue are those of the author(s), and do not necessarily reflect the opinions of the U4 Partner Agencies or CMI/ U4. (Copyright 2017, CMI/U4) Cover photo: ILO/Joseph Fortin (Creative Commons)

Preventing corruption in community mineral beneficiation schemes Dr Michael Nest

U4 Issue February 2017 No 3

Table of contents Abstract................................................................................................................................................ 4 Introduction......................................................................................................................................... 5 Research approach and methods............................................................................................. 6 Literature review............................................................................................................................... 8 Models of CMBSs....................................................................................................................... 10 Corruption and CMBSs.................................................................................................................. 11 Guidance materials on managing corruption risks.......................................................... 11 Seven cases of corruption....................................................................................................... 13 The impact of corruption.......................................................................................................... 16 Potential anti-corruption strategies........................................................................................ 19 Administrative solutions.......................................................................................................... 19 Building capacity to prevent corruption............................................................................. 21 Preventing corruption through multi-stakeholder engagement................................. 22 CMBS reform.................................................................................................................................... 24 Redesign of Sierra Leone’s DACDF....................................................................................... 24 Redesign of Ghana’s MDF........................................................................................................ 25 Reform via cash transfers....................................................................................................... 26 An agenda for action...................................................................................................................... 28 Policy recommendations.......................................................................................................... 28 Allocating roles to stakeholders........................................................................................... 29 Conclusion......................................................................................................................................... 31 Annex 1: Seven cases of corruption in community beneficiary mining schemes....... 32 Annex 2: Corruption risks and possible resulting corrupt acts....................................... 34 Annex 3: References...........................................................................