World Bank Group Debars Three Companies, Promotes Higher Integrity Standards as Terms of Settlements

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    Amid an unprecedented year, the World Bank Group concluded 18 settlement agreements in fiscal year 2021 with companies or individuals who participated in World Bank-financed operations across 13 countries. The final three of these settlements, which resolve matters of sanctionable misconduct, were announced today.

    Each of today’s announced settlement agreements highlights aspects of the World Bank Group’s efforts to promote higher integrity standards in Bank Group-financed projects.

    The first settlement, reached with a company in the Republic of Yemen, exemplifies international anticorruption cooperation. The agreement flowed from a case that was aided by the extensive cooperation of the United Nations Office for Project Services, which is responsible for the implementation of the project under a special financing agreement with the World Bank Group.

    The second settlement, which flows from a Bank investigation in Brazil that resulted in multiple sanctions cases, demonstrates how these agreements help promote better business practices. The settling firm, a large contractor, is a frequent business partner of the World Bank Group. Under the agreement, the company commits to develop and implement integrity compliance measures, including among other requirements the development or revision of its anti-fraud policies, improvements in its internal controls, training of its employees on anti-fraud and general corporate ethics, and continued cooperation with the World Bank Group’s anticorruption efforts. Beyond the specific transactions at issue in this case, these improvements in the company’s integrity compliance standards and business practices are expected to benefit the broader portfolio of World Bank projects—current or future—carried out by the company or its affiliates.

    The third settlement, reached with a company in Liberia, illustrates how firms can benefit when they acknowledge wrongdoing and commit to reform. While the Bank and company agreed upon a settlement only after the World Bank Group sought to impose sanctions, it nevertheless received a reduced period of debarment in light of its admission of culpability for its sanctionable conduct.

    These settlements exhibit how the World Bank Group’s Integrity Vice Presidency continues to pursue its mission to detect, deter, and prevent fraud and corruption in World Bank Group-financed activities.

    Details of the three settlements are below:

    World Bank Group Debars Al-Zubairi Group for General Trading, Contracting, Transportation, and Oil Services

    The World Bank Group today announced the 6-month debarment of Al-Zubairi Group for General Trading, Contracting, Transportation, and Oil Services (“Al-Zubairi”), in connection with a fraudulent practice as part of the Yemen Emergency Electricity Access Project in the Republic of Yemen.

    The debarment makes Al-Zubairi ineligible to participate in projects and operations financed by institutions of the World Bank Group. It is part of a settlement agreement under which the company acknowledges responsibility for the underlying sanctionable practice and agrees to meet specified corporate compliance conditions as a condition for release from debarment.

    Following the initial debarment, the sanction of Al-Zubairi will convert to a conditional non-debarment for a period of twelve months. During this time, Al-Zubairi will be eligible to participate in projects and operations financed by institutions of the World Bank Group as long as it complies with its obligations under the settlement agreement. Otherwise, the conditional non-debarment will revert to a sanction of debarment with conditional release, and the company then will become ineligible to participate in World Bank Group projects and operations until the conditions for release set out in the settlement agreement are met.

    The project was designed to improve access to electricity in rural and peri-urban areas within the Republic of Yemen. According to the facts of the case, Al-Zubairi misrepresented the company’s past experience by using a competitor’s experience credentials to meet the requirements for a World Bank-financed tender, which is a fraudulent practice.

    The settlement agreement provides for a reduced period of debarment in light of Al-Zubairi’s cooperation and voluntary remedial actions. As a condition for release from sanction under the terms of the settlement agreement, Al-Zubairi commits to undertake a corporate ethics training program consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines. It also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.

    The resolution of this matter was aided by the extensive cooperation of the United Nations Office for Project Services (UNOPS), which is responsible for the implementation of this project under a special Financing Agreement between the World Bank Group and UNOPS.

    World Bank Group Debars COBRAPE – Companhia Brasileira de Projetos e Empreendimentos

    The World Bank Group today announced the eleven-month debarment of Brazil-based COBRAPE – Companhia Brasileira de Projetos e Empreendimentos, a firm that provides consultancy services in sectors including water supply, sanitation, and transportation. The period of debarment will be followed by a period of conditional non-debarment for an additional seven months, for a combined sanction period of eighteen months.

    The sanction is imposed in connection with the implementation of a consulting contract under the World Bank-financed Integrated Municipal Project – Betim Municipality in Brazil. The project was designed to assist the Municipality of Betim in promoting sustainable socio-environmental development, reducing inequality, and enhancing the city’s quality of life through integrated investments in urban environment infrastructure and social services coupled with broader efforts to improve municipal governance, regulatory policy, and institutional strengthening.

    According to the facts of the case, in December 2008, COBRAPE certified to the Municipality of Betim that three of its professionals had been working full time on the Betim Municipality Project in November and December 2008, when they had not in fact done so. By certifying more hours than actually worked, COBRAPE influenced the contract execution and obtained an expected financial benefit of unwarranted payments of 10,340 Brazilian Real (approximately US$4,400), to the detriment of the Municipality of Betim, although that was subsequently remedied through a credit that the company provided to the Municipality in a later invoice, after apologizing for the initial overcharge. COBRAPE does not contest that the conduct constitutes a sanctionable misrepresentation under the World Bank Consultant Guidelines.

    COBRAPE’s sanction is part of a settlement agreement under which the company does not contest culpability and agrees to meet specified corporate compliance conditions for its release from sanction. During the eleven-month debarment period, COBRAPE will be ineligible to participate in projects and operations financed by institutions of the World Bank Group. Subsequently, during the seven-month conditional non-debarment period, COBRAPE will be eligible to participate in projects and operations financed by institutions of the World Bank Group, as long as it complies with its obligations under the settlement agreement.

    The settlement agreement provides for a reduced period of sanction in recognition of: (i) remedial actions taken by COBRAPE at the time of contract execution to address and mitigate the issue; (ii) the passage of time since the relevant conduct occurred; (iii) the company’s implementation over a period of years of a revised contract control system; (iv) COBRAPE’s efforts to establish an integrity compliance program and improve its internal controls; (v) the company’s voluntary restraint from bidding for World Bank Group-financed contracts during settlement negotiation; and (vi) the Respondent’s cooperation with the World Bank Group during settlement negotiation.

    As a condition for release from sanction under the terms of the settlement agreement, the company commits to develop and implement integrity compliance measures consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines. The company also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.

    World Bank Group Debars Crosswords Ltd.

    The World Bank Group today announced the six-year debarment of Crosswords Ltd. (Crosswords), a Liberian trading company, in connection with fraudulent and obstructive practices under the Integrated Public Financial Management Reforms for Institutional Strengthening Project II (the IPFMRP II Project) and the Social Safety Nets Project (the LSSN Project) in Liberia.

    The debarment makes Crosswords ineligible to participate in projects and operations financed by institutions of the World Bank Group. It is part of a settlement agreement under which the company acknowledges responsibility for the underlying sanctionable practices and agrees to meet specified corporate compliance conditions as a condition for release from debarment.

    The IPFMRP II Project is designed to improve domestic revenue mobilization systems and strengthen financial control and accountability in public finances. The LSSN Project is designed to establish the key building blocks of a basic national safety net delivery system, and to provide income support to households that are both extremely poor and food insecure.

    According to the facts of the case, Crosswords engaged in fraudulent practices by submitting forged documents in two bidding processes under the IPFMRP II Project and one bidding process under the LSSN Project. Crosswords also engaged in obstructive practices by making false statements and presenting falsified documents to World Bank Group investigators regarding the two bidding processes under the IPFMRP II Project.

    The settlement agreement provides for a reduced period of debarment in light of the company’s admission of culpability for the sanctionable conduct. As a condition for release from sanction under the terms of the settlement agreement, the company commits to developing an integrity compliance program consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines. The company also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.

    The debarment of Crosswords qualifies for cross-debarment by other multilateral development banks (MDBs) under the Agreement for Mutual Enforcement of Debarment Decisions that was signed on April 9, 2010.

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