World Bank stands by its findings

In a letter responding to the Senate’s invitation, World Bank (WB) country director for the Philippines Bert Hofman stood by the findings of the bank, saying the Sanctions Board came to its decisions after a careful and intensive process of investigation and evaluation conducted by the bank’s investigative office, Integrity Vice-Presidency (INT).

INT is a separate vice presidency charged with investigating allegations of fraud and corruption in bank-financed projects. It reports directly to the president of the WB and is staffed by a team including investigators, legal specialists, forensic accountants and others, Hofman said.

No WB representatives attended the Senate hearing and Santiago said they could not be compelled to do so because of restrictions imposed on them in attending formal hearings of parliaments in member-countries.

Hofman said the investigation included numerous interviews across several countries and an in-depth review of all documentation related to the bidding process under the National Roads Improvement and Management Program (NRIMP) 1 project.

“The investigation found evidence that several firms and individuals may have engaged in collusion in connection with two contracts under the project. The report of the investigation was shared with the relevant authorities in the Philippines,” Hofman said.

“All of the firms and individuals in this case were given ample opportunity to defend themselves. They all received the Bank’s Notice of Sanctions Proceedings in May 2008, and were given 90 days to submit a response in their defense and contest the allegations against them,” he noted.

Hofman said the firms and individuals were also entitled, as part of their response, to request a hearing before the bank’s Sanctions Board, if they chose to do so, and some did.

The Sanctions Board consists of external legal experts and senior WB staff and since 1999, more than 350 firms and individuals from more than 22 countries – including the US, Sweden, the Netherlands and the United Kingdom – have been banned from bidding for bank-financed projects, either indefinitely or for a specific period of time.

“Throughout the Sanctions process, we have been in regular dialogue with oversight agencies and the Department of Public Works and Highways. Based on the experience of phase one, we have incorporated tighter security and oversight mechanisms in the second phase of the program to ensure that both Government and World Bank money is used properly,” Hofman said. – Aurea Calica