Odious Debts

U.S. says development bank corruption ‘intolerable’

by Reuters

July 21, 2004
Washington: Corrupt use of World Bank and other global development money is “intolerable” and more needs to be done to root out abuses, a senior U.S. Treasury official said on Wednesday. Testifying before a U.S. Senate committee on corruption in multilateral bank development projects, John Taylor, treasury undersecretary for international affairs, said financial institutions need to tighten procurement policies, improve staff education and strengthen whistle-blower policies to ensure transparency in their lending and other operations. “Specifically, we should be able to establish that a school has got built as opposed to a contractor siphoning money out [of] the process, thus undermining the entire international banking system,” he said. “If we’re not sufficiently observant or we are not aligned with enough nations to track these people down and prosecute them, then there is going to be a lot of skepticism.” Since the late 1990s, the World Bank has imposed sanctions on about 180 firms and individuals in connection with the abuse of Bank funds. The Bank has also established a hotline so the public can report incidents of corruption. The Bank announced on Wednesday that Bolivia had convicted 15 people for fraud and corruption related to a $62.8 million rural investment project funded by the Bank. The Bank said it had alerted Bolivian authorities after finding evidence of bid manipulation, collusion, fraudulent invoices, kickbacks and payments for work never done.¬†

Categories: Odious Debts

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