Slight Drop in Fraud, Corruption, and Misconduct Complaints to ADB
MANILA, PHILIPPINES - ADB's fraud investigators received 171 complaints in 2006, a slight reduction from the 199 the previous year, according to the Annual Report of the institution's Integrity Division. Out of the complaints received during the year, ADB's Integrity Division began 108 investigations, of which 81 were closed after concluding further investigation was not warranted. Seventeen cases were referred to the three-person Integrity Oversight Committee (IOC), which determines if firms or individuals involved in ADB-financed activities violated its policies and can impose sanctions based on Integrity Division findings and recommendations. IOC found that 37 firms and 32 individuals had violated policy during the year and debarred 34 firms for periods ranging from one to seven years and three firms for 10 years. Fourteen individuals were debarred indefinitely and 17 for periods ranging from one to seven years, while one person was reprimanded. ADB does not publicly name those on its debarment lists. The Integrity Division, part of ADB's Office of the Auditor General, categorizes allegations according to whether they refer to corrupt or fraudulent practices or "other" concerns under ADB’s Anticorruption Policy, such as internal matters like conflicts of interest, staff misconduct and internal administration violations. More than half of the cases opened in 2006 involved corrupt practices, 42% fraud, and 6% others. During the year, the Integrity Division referred seven staff cases to ADB's Human Resources Division to consider disciplinary action. The most common form of fraudulent practice investigated in 2006 was misrepresentation and falsification of documents. Collusive practices account for 46% of the corrupt practices cases. The Integrity Division also conducted five project procurement-related audits to identify and prevent internal control weaknesses that might allow fraud, corruption or abuse to occur in ADB-financed projects. It also focuses on education and awareness of the Anticorruption Policy among staff and key institutions in ADB’s developing member countries. “The Integrity Division helps foster a culture of compliance to deter fraud and corruption,” says A. Michael Stevens, Integrity Division Director. “Our job is to gather and analyze evidence and ensure behavior conforms to the highest ethical standards required by our Anticorruption Policy.” To maintain security and confidentiality, the Integrity Division maintains a report hot line, confidential fax line, dedicated email address (integrity@adb.org), and enhanced computer and storage security. While referrals from ADB staff remain the main source (42%) of allegations of fraud or corruption, outside parties continue to be an important source of allegations, accounting for one third of complaints. See the full report. Visit ADB's Integrity web site. About ADB | 
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