TRACE BRIBEline Report Details Bribery Trends In Mexico

ANNAPOLIS, Md., March 25 /PRNewswire/ -- Today, TRACE released the results of its latest country report on demand-side bribery in Mexico, the 2010 BRIBEline Mexico Report.  The general profile of bribe demands in Mexico that emerges from this report is one of extortionate and repetitive demands for cash made by government officials. The BRIBEline Mexico Report compiles anonymous tips by the frequency, type and goal of bribe requests made throughout Mexico and reported to BRIBEline.

"Mexico is an extremely important player in the world economy.  With respect to the United States alone, Mexico is its third largest goods trading partner," said TRACE President Alexandra Wrage.  "Knowing the pressure points of doing business in Mexico is a critical first step in tailoring an effective anti-bribery compliance program.  The BRIBEline Mexico Report gives concrete information about the people who are requesting bribes in Mexico, how frequently such requests are made and what the bribe seekers hope to achieve."  

Specifically, the BRIBEline Mexico Report results identify the police as the number one source of bribe demands, representing 45% of all bribes demanded in that country, with national-level government officials a distant second at 12%.  An overwhelming 85% of all bribe demands in Mexico were made by persons deemed to be government officials under the Foreign Corrupt Practices Act, including the police, national-level government officials, as well as state and local government officials, employees of state-owned entities, judges and other members of the judiciary, members of the military and ruling party officials.

The BRIBEline Mexico Report reveals that nearly 60% of the reported bribe demands were recurring.  Of these reports, almost 80% indicated that a bribe was to be paid twenty or fewer times in a given year.  At the other end of the spectrum, 15% of these reports indicated that a bribe was to be paid more than 100 times in a single year.

Cash is the preferred form of bribe payment by a wide margin.  Demands for cash bribes accounted for over 80% of all reported bribe demands in Mexico, as compared to demands for additional business (5%), sexual favors (4%), other types of benefits such as assistance with visas, medical care or tuition (4%), items of gifts, entertainment and hospitality (4%) and travel (2%).  The value of the bribes demanded in Mexico was relatively modest: 65% were for amounts less than $5,000.  However, 10% of reported bribe demands were estimated to be for amounts greater than $10,000, with 4% of all bribe requests demanding more than $100,000.

Nearly half of all survey respondents reported being the victim of an extortionate demand, including avoiding personal harm or harm to business interests (23% of all bribe demands), receiving the timely delivery of a service to which the target of the bribe demand is already entitled (15%) or being approached for a bribe in order to receive payment for services already rendered (6%).  

"The BRIBEline Mexico results present two compliance challenges," added Wrage.  "First, frequent demands for small amounts of cash are very difficult to track and properly record on a company's books and records.  Second, training employees and third party agents who are conducting business in Mexico to properly respond to extortionate demands for cash, which are often made by a police officer, is no easy task either."

The 2010 BRIBEline Mexico Report includes statements from 151 respondents from July 2007 until January 2010. The full report is available online at www.BRIBEline.org.

TRACE is a non-profit membership association that pools resources to provide practical and cost effective anti-bribery compliance solutions for multinational companies and their commercial intermediaries (sales agents and representatives, consultants, distributors, suppliers, etc.). TRACE provides several core services and products, including: due diligence reports on commercial intermediaries; model compliance policies; an online Resource Center with foreign local law summaries, including guidelines on gifts and hospitality; in-person and online anti-bribery training; and research on corporate best practices. For more information, visit www.TRACEinternational.org.

SOURCE TRACE