making local government more ethical
A Municipal Bid Rigging Scheme Comes to Light
According to an article in the New York Times this week, Banc of America Securities (which recently merged with Merrill Lynch) agreed to pay the SEC and others $137 million to settle charges related to a municipal bond bid-rigging scheme. For those who think competitive bidding rules are enough, this case should make you think otherwise.

I find it fascinating that, although kickbacks (also known as "thanks giving") are one of the central elements of unethical conduct in local governments, I have only mentioned them three times in my blog posts.

Kickbacks are a dirty secret for one principal reason:  they are difficult to prove. Along with bribes, they require hard-to-obtain proof to tie money to conduct. Coincidentally, these are the two forms of conduct that the Supreme Court, in Skilling v. U.S., said the federal honest services fraud statute could be applied to (see my blog post on this decision).
The spread of corruption from local to state to national is often ignored. And when corruption is discovered, there is much litigation. In fact, it's often hard to see corruption clearly here in the U.S. That's why the occasional look at corruption abroad is useful, like looking in an only slightly distorted mirror.

Vernon, CA, the subject of several blog posts here (click here for the latest), has been the object of criminal investigations, but now local officials are starting to get creative in response to the most creatively imagined city in the U.S.

A week ago, Transparency International published its fifteenth annual Corruption Perceptions Index, which scores countries on the basis of a variety of independent reports on and surveys about corruption, including those from the World Bank and other development banks, and those surveying journalists, business executives, and international organization staff.

Here in the U.S., the big news is that, for the first time, the U.S. has fallen out of the top 20 least corrupt nations, mainly due, it appears, to the effect of money in politics and the information that came out due to the financial crisis. The U.S. fell from 18 to 22, just behind Chile and just ahead of Uruguay.

Consultants often fall between the cracks of government ethics. They are contractors, but professionals rather than suppliers or construction companies, and they often act just like government officials, only they're not on the payroll. And yet the ethics rules that apply to government officials often do not apply to consultants. Often, ethics commissions don't even have jurisdiction over consultants.

An audit report done by the Los Angeles City Controller for the Los Angeles Unified School District (LAUSD) just came out. It was commissioned after a consultant acting as a government employee allegedly funneled business to a company he co-owned. The school district, which had done a huge school construction program, wanted to see if there were other conflicts of interest. It calls its consultants CPs, that is, contract professionals.