I think cap and trade establishes some type of baseline ownership of pollution rights. For instance, some company who's been in business for a while, say an electrical power generation company, gets an initial allotment of credits. If they need more, they buy them from another company. If they have too many, they sell them. The corruption happens during the initial allotment, and the law will probably also be written to favor established interest who own an exchange where they will charge fees for every transaction.

A tax is just money going into the Treasury, plain and simple. Then you at least have a chance to curb corruption before the government spends it.