The World Bank’s INT list below includes 23 Issues of Fraud and Corruption, which should be reported for further review. In 2004, the Armenian Parliamentary Commission reported problems to the World Bank Armenia Country Manager, which implied that up to 20 of those issues could have been violated under the Municipal Development Project.
Suspected contract irregularities - Yes
Violations of the Bank's procurement guidelines - Yes
Bid manipulation - Yes
Bid collusion - Yes
Coercive practices - Yes
Fraudulent bids - ?
Fraud in contract performance - Yes
Fraud in an audit inquiry - Yes
Product substitution - Yes
Price manipulation - Yes
Substandard or inferior parts or materials - Yes
Cost or labor mischarges - Yes
Kickbacks - Yes
Bribery or acceptance of gratuities - ?
Abuse of authority - Yes
Misuse of Bank Group funds or funds entrusted to the Bank Group - Yes
Travel-related fraud - Yes
Theft and embezzlement - Yes
Benefits and allowance fraud - ?
Conflict of interest - Yes
Misrepresentation - Yes
Forgery - Yes
Involvement of Bank Group staff in any of the afore-mentioned. - Yes
A thought for Juan ...............?
The Bank’s Fiduciary Responsibility
Under Article III, Section 5(b) of the Articles of Agreement of the International Bank for Reconstruction and Development (IBRD), the Bank is required to make arrangements to ensure that the proceeds of any loan are used only for the purposes for which the loan was granted, with due attention to considerations of economy and efficiency and without regard to political or other noneconomic influences or considerations. Similar requirements are specified in Article V, Section 1(g) of the Articles of Agreement of the International Development Agency (IDA).
Fraud and corruption can divert loans and credits to purposes other than those for which these were granted. Inevitably, such diversion would also seriously affect the efficiency and effectiveness of the concerned projects. As such, the Bank and its staff have a fiduciary responsibility to prevent fraud and corruption in projects financed by it.