When government has a lot of money and power, it is natural for people to curry its favor. It is just as natural for those wielding money and power to use it for personal gain. The Export-Import Bank provides numerous real-world examples of this human frailty. Last year, The Wall Street Journal reported that four Ex-Im employees have been removed or suspended in recent months, “amid investigations into allegations of gifts and kickbacks.”
Johnny Gutierrez, an Ex-Im employee, was one of the four, and recently pleaded guilty in court to accepting $78,000 in bribes from an executive of Impex Associates, a Florida-based construction equipment manufacturer that has received Ex-Im financing on multiple occasions. The other cases involve two “allegations of improperly awarding contracts to help run the agency,” and another employee who accepted gifts from an Ex-Im suitor. A spokesman responded to the allegations by drily noting that "the Export-Import Bank takes extremely seriously its commitment to taxpayers and its mission to support U.S. jobs."
These are not isolated incidents. In 2010, Bloomberg News reported that Exxon Mobil Corp. paid for nearly $100,000 of travel expenses for Ex-Im employees to locations including “London, Tokyo, and the South Pacific.” Exxon Mobil was seeking $3 billion in financing from Ex-Im at the time, and received it 11 months later.
The most famous corruption case in recent years implicated former Congressman William “Dollar Bill” Jefferson, who was sentenced to 13 years in prison for accepting bribes from iGate, a Nigerian company seeking Ex-Im financing. FBI officials discovered $90,000 in cash in Jefferson’s freezer.
The Heritage Foundation’s Diane Katz found that 74 potential cases of fraud have occurred between 2009 and 2014. For an agency with only 400 employees, this is a very serious problem. All in all, there are 30 open corruption investigations right now involving Ex-Im.
These corruption allegations offer another reason to end the Export-Import Bank. With Ex-Im gone, its beneficiaries would spend less time wooing government officials, and more time creating value for consumers. Getting rid of Ex-Im wouldn’t just help the economy, it would remove one of Washington’s numerous opportunities for corruption.