Maravi

World Bank blacklists 2 companies over bribes

World Bank blacklists 2 companies over bribes
By Kabanda Chulu
Fri 02 Mar. 2012, 11:00 CAT

THE World Bank has blacklisted and fined two subsidiaries of a French engineering company, Alstom SA, after the companies allegedly offered bribes to gain a power rehabilitation plant contract in Zambia in 2002.

The Alstom subsidiaries, Alstom Hydro France and Alstom Network Schweiz AG in Switzerland, will pay US$9.5 million (K50.1 billion) in restitution and be blocked from bidding on World Bank contracts for up to three years.

The sanctions are tied to an alleged bribe of 110,000 euros (K781 million), which the World Bank stated that Alstom paid to an entity controlled by a former senior government official for consultancy services for a World Bank-financed power-rehabilitation project in Zambia in 2002.

In a press statement themed ‘Enforcing accountability', World Bank vice-president for integrity Leonard McCarthy stated that the sanctions were a significant step in deterring the risks of fraud and corruption.

"This case demonstrates a clear commitment from the World Bank to ensure development funds reach their intended beneficiaries while setting a high standard for global integrity where project resources may be at stake," McCarthy stated.

"Alstom's settlement with the Bank is a wake-up call to global companies that are involved in development business that need to ensure their operations with the World Bank are clean. Alstom is a major player in the hydropower sector and their commitment under this agreement is a significant step in deterring the risks of fraud and corruption."

In 2002, Alstom made an improper payment of K781million (110,000 euros) to an entity controlled by a former senior government official for consultancy services in relation to the World Bank-financed Zambia Power Rehabilitation Project.

The number of companies on the World Bank's blacklist has increased sharply from 2008, when it banned just one company from bidding on its contracts.

Last year, 92 companies or individuals were put on the blacklist, which is published on the bank's website.

Two years ago, the World Bank signed agreements with other institutions including the Asian Development Bank and the Inter-American Development Bank agreeing to jointly blacklist any company that one of the banks finds guilty of graft or collusion.

Labels: BRIBERY, CORRUPTION, World Bank

posted by MrK @ 5:18 PM