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12 Mar, 2014

Report discloses attempts to cheat, defraud Asian Development Bank

Manila, 11 March 2014 – Submission of fraudulent documents, recommending spouses to work as consultants, misrepresenting work experience and accepting kickbacks from suppliers were among some of the 250 cases related to internal fraud and corruption reported to the Asian Development Bank in 2013.

Other cases identified in the ADB’s Annual Report of the Office of Anticorruption and Integrity (OAI) released on March 11 included investigations of collusion between bidders and use of substandard materials in construction projects. A number of the investigations involved contracts related to airports and highways.


This excellent ADB report should serve as a good example for the many travel industry associations, groupings and organisations known to be facing similar problems. It is a readymade template that will cost nothing to copy and implement, which the ADB will almost certainly welcome.

According to the bank, the anti-corruption work focused on prevention, oversight, investigation, and deterrence through strengthened due diligence, partnerships, awareness raising, and greater outreach in 2013. In line with ADB’s zero tolerance for corruption, OAI reviews and assesses all complaints of corruption reported to it.

In 2013, ADB’s Office of Anticorruption and Integrity (OAI) received 250 complaints, surpassing the previous record of 240 received in 2012. Most of the complaints came from external ADB stakeholders, and almost half from ADB staff, highlighting the crucial role of both staff and civil society in combating threats to the integrity and effectiveness of ADB’s development work, the bank said.

In 2013, OAI investigated 239 cases and closed 76; while the Integrity Oversight Committee, a three-member panel that decides whether to impose prohibitions, confirmed sanctions on 30 individuals and 30 firms.

As part of an agreement between ADB and four other multilateral development banks, ADB cross-debarred 324 entities. These stringent measures help ensure development funds deliver desired results and benefit the people of Asia and the Pacific, the bank said.

“Fraud related to work experience, qualifications, and technical and financial capacities of consulting firms or consultants continues to be the most common type of integrity violation reported to OAI,” said Clare Wee, OAI Head.

The anti-corruption efforts are designed to protect the integrity of ADB-financed, supported, and administered activities. More than ever, in 2013 OAI’s anticorruption work focused on prevention, oversight, investigation, and deterrence through partnership, awareness raising, and outreach.

Says the bank, “OAI recognizes that tackling corruption requires a multifaceted approach and a comprehensive network of partnerships and alliances. Tasked to ensure that the finite development funds entrusted to ADB are not misused as a result of fraud and corruption, OAI relies on close collaborations with internal and external partners and stakeholders to fulfill its mandate.”

ADB was the first among international financial institutions to pioneer Project Procurement-Related Reviews (PPRRs), which can mitigate risks of fraud and corruption and protect funds from improper use in ADB-financed projects. During PPRRs, project outputs are inspected, internal controls are assessed, and irregularities and areas of possible noncompliance are identified. In 2013, the bank said, OAI conducted seven new PPRRs and issued three reports for PPRRs conducted in 2012. Summarized findings from PPRRs conducted since 2003 have been injected into OAI’s training and awareness-raising initiatives.

To prevent fraud and corruption in ADB-financed projects, OAI provides substantial support and advice to management and project teams on issues relating to integrity due diligence. With ADB’s increased work in private sector development and private sector operations, OAI’s due diligence advisory function saw a dramatic uptake in 2013. Requests to provide due diligence and advice on reputational risks, anti-money-laundering and combating the financing of terrorism risks increased from 15 in 2012 to 253 in 2013.

In 2014, OAI expects to update its Integrity Principles and Guidelines, consistent with similar reviews being conducted by other multilateral development banks. OAI will also continue its awareness-raising programs in 2014 to help ADB staff to spot the warning signs of corruption and fraud.

Click here to download: Office of Anticorruption and Integrity: Annual Report 2013