Fighting fraud and corruption in ADB projects

ADB's Office of Anticorruption and Integrity (OAI) recognizes that tackling corruption requires a multifaceted approach and a comprehensive network of partnerships and alliances. Tasked to ensure that the finite development funds entrusted to ADB are not misused as a result of fraud and corruption, OAI relies on close collaborations with internal and external partners and stakeholders to fulfill its mandate. OAI's mandate is underpinned by ADB’s zero tolerance to corruption. It is aligned with ADB’s broader commitment to combat corruption and improve governance as a core strategic objective of ADB Strategy 2020, and the Paris Declaration on Aid Effectiveness of 2005--to which ADB is a signatory--in support of effective, transparent, and accountable aid.

In 2013, OAI’s anticorruption work focused on prevention, oversight, investigation, and deterrence through partnership, awareness raising, and outreach. Its achievements in 2013 reflect OAI's close partnership and teamwork with ADB's governance and operations departments as well as external partners to address fraud, corruption, abuse of resources, and other violations that undermine the integrity and effectiveness of ADB-funded activities.

Investigating allegations

In 2013, OAI received 250 complaints, surpassing the previous record of 240 received in 2012. It converted 92 complaints into investigations and processed sanctions imposed on 30 individuals and 31 firms. Almost half of the complaints came from ADB staff, highlighting their crucial role 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.

ADB continued to use sanctions as a remedial measure to protect the integrity of ADB-financed, supported, and administered activities. In justified circumstances, ADB also utilized temporary sanctions to manage integrity and reputational risks arising from continued involvement with firms and individuals that are the subject of an OAI investigation.

Conducting proactive reviews

In collaboration with ADB operations departments, OAI has continued to roll out targeted project procurement-related reviews (PPRRs). 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.

Enhancing due diligence

In 2013, as ADB increased its commitment to private sector development and private sector operations and as part of Strategy 2020, OAI’s due diligence advisory function saw a dramatic uptake. In its second full year of carrying out its additional mandate of providing independent advice on Integrity Due Diligence (IDD) and anti-money-laundering and combating the financing of terrorism (AML/CFT) risks, requests for advice from OAI increased from 15 in 2012 to 253 in 2013.

Empowering through knowledge sharing

OAI has continued to expand its awareness-raising activities to proactively inform staff, civil society, and the private sector about the negative impacts of fraud and corruption. Staff training emphasizes the role and responsibility of ADB staff in implementing ADB’s Anticorruption Policy. OAI also actively encourages staff to be discerning and to undertake due diligence and conflict of interest checks as effective preventive measures against corruption and to mitigate integrity risks.

In 2013, in conjunction with ADB’s “iAct--I Fight Corruption” internal anticorruption outreach campaign, ADB celebrated International Anticorruption Day, focusing its outreach on resident mission colleagues. During the celebration, ADB President Takehiko Nakao stressed to staff the need for collective action against corruption so that ADB can make a difference for the benefit of the people it serves.

Maria Leonor Gerona-Robredo shares her experiences in promoting good governance during International Anticorruption Day 2013. Also in picture (from right to left) are Heartfile President and Founder Sania Nishtar; ADB President Takehiko Nakao; Office of Anticorruption and Integrity Head Clare Wee; and Regional and Sustainable Development Department Deputy Director General Woochong Um.

Joining forces with other MDBs

Likewise, the fight against corruption requires a global partnership to promote a unified front against corruption. In 2013, OAI continued to share its experience and expertise at multilateral development bank (MDB) forums. In particular, over the past years OAI has been sharing its PPRR approach and lessons learned with other development partners worldwide. The wider adoption of the PPRR model was proposed by OAI as an anticorruption tool during the annual Conference of International Investigators of United Nations Organizations and Multilateral Financial Institutions held in July 2013.

Cross-debarment continues to embody the collective curative force of the MDB community against integrity violations. A total of 328 entities were cross-debarred across MDBs in 2013. The World Bank’s debarment of SNC Lavalin and 198 of its related entities in April 2013 more than doubled the total presented for cross-debarment between 2010 and 2012.