Saturday, March 15, 2008

Dealing with the Supply of Corruption

In the wake of allegations of corruption in World Bank-funded health programs in India, the World Bank said it had started nine investigations, which could lead to companies being barred from doing business with the bank.

Additionally, the bank said, the Indian government has referred three cases of alleged corruption to India's Criminal Bureau of Investigation. Orissa state also has started a number of follow-up probes, the bank reported.

The actions were designed to send a message that the World Bank is taking seriously a January report by bank investigators who alleged fraud and corruption in $570 million of health projects the bank has funded in India.

Over the years, the World Bank has sometimes taken an ambivalent attitude toward corruption, with some officials figuring it was a second-tier problem in helping countries develop economically.

The World Bank didn't name the companies being investigated, but they are likely to include those named in the January report, among others. According to the report, Bayer AG and BASF AG, as well as prominent Indian firms, were involved in a bid-rigging cartel involving about $33 million in procurements of a mosquito pesticide called pyrethroid.

-World Bank Probes Health-Fraud Claims

No comments: