Financial Crime and Corruption Plague Ecuador

Ecuador has long struggled with a pervasive problem of financial crime and corruption, with little sign of improvement despite government efforts to address the issue.

The Extent of Corruption in Ecuador

According to Transparency International’s 2016 Corruption Perceptions Index, Ecuador ranked 120 out of 176 countries surveyed, earning a paltry score of 31 out of 100. The report highlights the widespread nature of corruption in the country, with illicit payments for official favors and theft of public funds reportedly taking place frequently.

Challenges in Addressing Corruption

The problem is compounded by a lack of transparency and inefficiency in the judicial system, making it difficult to settle disputes and hold corrupt officials accountable. Offering or accepting a bribe is punishable by up to five years in prison, but the law is often ignored with impunity.

High-Profile Corruption Scandals

State-owned petroleum company PetroEcuador and Brazilian construction firm Odebrecht have both been embroiled in high-profile corruption scandals, underscoring the significant challenges facing Ecuador in its battle against graft.

Government Efforts to Combat Corruption

In response to the problem, President Correa’s government created the Transparency and Social Control branch of government in 2008, tasked with preventing and combating corruption. The National Secretariat for Transparency was also established to investigate and denounce acts of corruption in the public sector.

The Need for Further Action

However, critics argue that more needs to be done to tackle the root causes of corruption in Ecuador, including strengthening institutions and improving transparency and accountability.

Reporting Corruption

Citizens can report alleged acts of corruption by dialing 159 within Ecuador or through a web portal maintained by the Council for Citizen Participation and Social Control (http://www.cpccs.gob.ec).

Warning from the U.S. Department of Commerce’s Commercial Service

The U.S. Department of Commerce’s Commercial Service has also weighed in on the issue, warning businesses operating in Ecuador to be aware of the risks associated with corruption and to take steps to mitigate them.

“Corruption is a significant risk for businesses operating in Ecuador. Companies should exercise caution when dealing with government officials and ensure that all transactions are transparent and above board.”

— U.S. Department of Commerce’s Commercial Service