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Sanctions Rise as Partnerships Strengthen ADB's Anticorruption, Integrity Measures
MANILA, PHILIPPINES – Anticorruption work of the Asian Development Bank (ADB) focused on prevention, oversight, investigation, and deterrence through strengthened due diligence, partnerships, awareness raising, and greater outreach in 2013, according to the Annual Report of the Office of Anticorruption and Integrity (OAI) released today.
In line with ADB’s zero tolerance for corruption, OAI reviews and assesses all complaints of corruption reported to it. OAI received a record 250 complaints in 2013. The majority of complaints came from external ADB stakeholders, highlighting the crucial role of civil society in combating threats to the integrity and effectiveness of ADB’s development work.
“Fraud related to work experience, qualifications, and technical and financial capacities of consulting firms or consultants continues to be the most common type of integrity violation reported to OAI,” said Clare Wee, OAI Head.
In 2013, OAI investigated 239 cases and closed 76; while the Integrity Oversight Committee, a three-member panel that decides whether to impose prohibitions, confirmed sanctions on 30 individuals and 31 firms. As part of an agreement between ADB and four other multilateral development banks, ADB cross-debarred 324 entities. These stringent measures help ensure development funds deliver desired results and benefit the people of Asia and the Pacific.
ADB was the first among international financial institutions to pioneer Project Procurement-Related Reviews (PPRRs), which can mitigate risks of fraud and corruption and protect funds from improper use in ADB-financed projects. During PPRRs, project outputs are inspected, internal controls are assessed, and irregularities and areas of possible noncompliance are identified. In 2013, OAI conducted seven new PPRRs and issued three reports for PPRRs conducted in 2012. Summarized findings from PPRRs conducted since 2003 have been injected into OAI’s training and awareness-raising initiatives.
To prevent fraud and corruption in ADB-financed projects, OAI provides substantial support and advice to management and project teams on issues relating to integrity due diligence. With ADB’s increased work in private sector development and private sector operations, OAI’s due diligence advisory function saw a dramatic uptake in 2013. Requests to provide due diligence and advice on reputational risks, anti-money-laundering and combating the financing of terrorism risks increased from 15 in 2012 to 253 in 2013.
In 2014, OAI expects to update its Integrity Principles and Guidelines, consistent with similar reviews being conducted by other multilateral development banks. OAI will also continue its awareness-raising programs in 2014 to help ADB staff to spot the warning signs of corruption and fraud.