(Washington, D.C.) – Today, the Government Accountability Project (GAP) is releasing a review of the World Bank’s Department of Institutional Integrity (INT) and its practices from 2005 – 2007. INT investigates allegations of misconduct, fraud, and corruption at the Bank, and designs anti-corruption measures to safeguard Bank resources. The GAP report documents several immediate and long-term problems at INT, including:
- A conflict of interest for the department director, who is also counselor to the president of the Bank; her dual positions compromise her credibility and actions.
- Routine breaches of confidentiality during ongoing investigations between 2005 and 2007;
- A complex personal, professional and financial network of relationships among INT, the International Republican Institute, and Diligence, LLC, a corporate intelligence firm;
- INT’s failure to comply with an authorized audit, which former Bank president Paul Wolfowitz suspended in March 2007;
- Suppression of a report prepared by an INT team that investigated corruption in three World Bank projects in the Democratic Republic of Congo; the report was suppressed for political reasons with the cooperation of the director of INT;
- Failure to investigate serious allegations of fraud in the Municipal Development Project in Yerevan, Armenia although evidence is documented and the fraud is both extensive and ongoing.
Deeper, longer term difficulties also affect the department. Personnel decisions are non-transparent and favor Americans over other nationalities. In FY06, a substantial budget boost failed to generate an increase in cases investigated and resolved, but resulted instead in a dramatic drop in the number of cases closed. Respondents told GAP that external cases are capriciously prioritized and the lessons learned from investigations fail to find their way back into Bank policy. Nor are these lessons transmitted to national authorities according to predictable and respectful protocols.
The report can be found on GAP’s website here.
This report comes one week prior to a World Bank panel’s review, commissioned in response to allegations of abuse of authority and mismanagement at INT, and headed by Paul Volcker. In a previous announcement, GAP objected to Volcker’s appointment to head the panel as an independent evaluator, as his professional connections place him too close to former INT staff members now employed by a corporate intelligence-gathering firm (Diligence, LLC) which has a contractual relationship to INT.
Many of the same individuals who cooperated with the Volcker panel have participated in GAP’s study. All factual information contained in the report has been verified by at least two independent sources, and all documents cited have been authenticated.
“Because of a prevailing climate of retaliation at the Bank, and especially within INT, GAP cannot reveal its sources, but we have verified all disclosures,” stated GAP International Program Director Beatrice Edwards, author of the report.
The interviews conducted show that immediate steps must be taken to address acute, persistent problems at INT. To rectify these problems:
- The department director should renounce one of her two positions. To work with integrity, she may be either counselor to the president or director of INT, but not both.
- The relationship between INT and Diligence, LLC, should be fully examined and all financial and personnel transactions between them should be fully quantified and disclosed.
- The report of the 2006 INT investigation concerning three DRC projects must be released.
- Serious allegations of large scale fraud in the Municipal Development Project in Armenia must be investigated.
- The audit suspended in March 2007 should resume immediately.
Over the longer term, the following strategic actions could be taken to improve INT processes:
- The department should establish a credible selection process for personnel appointments and promotions that is consistently transparent and fair. Lack of diversity and an unfair preference for Americans must be corrected.
- Steps should be taken to improve department morale and productivity. The performance and management profile in the department suggests widespread dissatisfaction among INT staff that is negatively affecting achievement.
- External investigations must be expeditious, thorough, systematic and impartial. Findings should be integrated into Bank policy, as well as into safeguard measures.
- Internal investigations must be conducted objectively and confidentially.
- Explicit and transparent procedures for triaging and investigating cases must be implemented.
- Efficiency must increase as measured by the number of cases investigated and closed annually.
- Formal, transparent regulations for reporting case findings to Bank authorities, national authorities, affected communities and the public must be developed, disclosed and implemented.
Supporting documentation for the GAP report can be found on the front page of our Web site at www.whistleblower.org.
Government Accountability Project
The Government Accountability Project is the nation’s leading whistleblower protection organization. Through litigating whistleblower cases, publicizing concerns and developing legal reforms, GAP’s mission is to protect the public interest by promoting government and corporate accountability. Founded in 1977, GAP is a non-profit, non-partisan advocacy organization with offices in Washington, D.C. and Seattle, WA.
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Contact: Bea Edwards, International Director
Phone: 202.408.0034 ext 155
Email: [email protected]
Contact: Dylan Blaylock, Communications Director
Phone: 202.408.0034 ext 137, 202.236.3733 (cell)
Email: [email protected]