The World Bank has banned 40 Indonesian firms and 29 individuals from participating in its projects for between 1 and 5 years due to their alleged involvement in fraud and corruption, the bank said in its latest report Wednesday.
The 40 Indonesian firms include the subsidiaries of a major automotive manufacturer, private and state publishing companies, and public works contractors located in big cities like Jakarta, Bandung, Semarang, Surabaya and Makassar.
As a result of its investigations, the bank had also issued six reprimands to four Indonesians, and an Indonesian private printing and publishing firm. However, they still remain eligible to tender for World Bank-financed contracts.
The World Bank is the only multilateral development bank that publicly announces the names of the firms it sanctions for corrupt practices.
The World Bank Group's independent investigative arm, the Department of Institutional Integrity, has investigated a total of 441 external fraud and corruption cases in bank-financed projects carried out during 2005 and 2006, which resulted in 58 firms and 54 individuals throughout the world being debarred by the bank.
Those firms and individuals have addresses in various countries, including Indonesia, Timor Leste, China, Cambodia, the United States, Canada, France, Britain, Albania, Lithuania, Russia and Burkina Faso.
Since 1999, the Bank has publicly sanctioned 338 firms and individuals for corrupt practices worldwide.
The Bank's integrity department probes not only allegations of fraud and corruption in bank-financed projects, but also allegations of possible staff misconduct. The department, for example, completed 227 internal investigations involving staff misconduct over the past two fiscal years.
It substantiated allegations in 77 of the cases involving 78 staff members, resulting in the termination of 34 personnel. It cleared the other staff members of any wrongdoing in 44 internal cases.
Director of the Department of Institutional Integrity, Suzanne Rich Folsom, said, "Corruption has a devastating impact on the capacity of governments to function properly; on the private sector to grow and create employment; on the talents and energies of people to add value in productive ways; and ultimately on societies to lift themselves out of poverty."
"The World Bank and the integrity department must continue to do everything possible to ensure that the funds entrusted to our institution by its shareholders are used for their intended purposes," she said. (07)