World Bank reaches settlement with SKM over corruption

25 July 2013

World Bank

World Bank

The World Bank has reached a settlement agreement with engineering contractor Sinclair Knight Merz (SKM) after the company self-reported corrupt misconduct relating to Bank-financed projects in the East Asia and Pacific region.

SKM and its parent companies and subsidiaries have been sanctioned with conditional non-debarment for two and a half years. This means that, as long as the companies fulfil certain conditions such as the implementation of a more robust integrity compliance programme and further co-operation with the World Bank, they will remain eligible to bid for Bank-financed projects.

“In the event that SKM fails to fulfil any of its obligations, the company will be immediately debarred,” the World Bank said, adding that the nature of the sanction reflected SKM’s voluntary acknowledgment of corrupt misconduct.

SKM also dismissed key individuals including senior managers connected with the illegitimate payments. The company initiated an internal appropriate-business-practices policy, and took steps to improve its governance and compliance procedures.

Leonard McCarthy, World Bank vice president of integrity, said, “The World Bank took into account SKM’s co-operation and willingness to provide evidence in support of further investigations.”

As a result of the co-operation received from SKM, the World Bank said it was able to take steps to safeguard its funds and also identify other potential targets for investigation.

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