World Bank faces call to blacklist construction firms

5 June 2002
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06 June 2002 | Robin Parker

An African court ruling on several international building firms' involvement in a bribery scandal could thwart their chances of securing future World Bank funding for major projects.

A former executive of the Lesotho Highlands Development Authority was convicted last month on 11 counts of bribery and two of fraud concerning payments of around £3 million from companies including French firm Spie Batignolles, Balfour Beatty and Kier International.

The payments span more than a decade and centre on bids for a dam building project.

The World Bank, which helped to fund the project, has launched an investigation.

But it faces growing demands from pressure groups to add the firms to its blacklist of 72 companies ineligible to bid for funding for projects because of fraudulent or corrupt practices.

Jeremy Pope, executive director of anti-corruption watchdog Transparency International, said the case could raise the bar for the blacklist, as it involves globally respected firms rather than the "fly-by-night operators" that are currently listed.

"It will be a very good test of will on the part of the World Bank to blacklist them," he said.

"The conduct of these firms is indefensible. Once there's corruption, it contaminates the whole project and they have to face the consequences."

Pope said the case proves that suppliers must beat corruption to protect reputations as much as to prove they are ethically sound.

The verdict comes after the UK's anti-terrorism act extended the domestic ban on bribes - including "facilitation payments" designed to speed up deals - to the rest of the world.

Kier International, which had a minority share in the main consortium, said there were "no actions actual or pending" against it or the consortium.

SMjun2002

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