IDB steps up fraud and corruption prevention

The Inter-American Development Bank (IDB) applied 52 sanctions - 36 to individuals and 16 to companies - as a result of 152 investigations into fraud and corruption in 2009.

These figures were released in the IDB's Office of Institutional Integrity (OII) annual report, which receives and investigates allegations of prohibited practices for the Bank. According to the report, it received a total of 309 enquiries in 2009, a record number, and a sharp increase on the 222 allegations made to it in 2008.

The sanctions taken in cases where wrongdoing was proved resulted in debarment from Bank projects in all but one case. In the most severe cases, seven individuals and three companies were permanently debarred from Bank projects.

According to the IDB, cases of fraud and corruption were the most common types of malpractice. These included a construction company submitting false invoices and forged certificates, and consultants working for an agency administering a project passing on confidential information to bidders. There were also cases of bid rigging.

In order to combat these issues, the OII has developed new Integrity Risk Reviews (IRRs) on the most common fraudulent practices, with strategies to reduce their prevalence. These assessments are usually carried out at the request of national governments or IDB departments.

In 2009 the OII completed IRRs covering Bolivia and Paraguay. It also prepared a preliminary report on Honduras, and began the IRR process in Nicaragua.