IFAD Anti-Corruption Policy for Development Integrity

Anti Corruption Policy Corruption hurts the poor disproportionately by diverting funds intended for development, undermining a government s ability to provide basic services, feeding inequality and injustice, and discouraging foreign investment and aid. Secretary-General of the United Nations Statement to the General Assembly on the UN Convention Against Corruption 31 October 2003

Anti Corruption Policy Zero-tolerance policy Appropriate sanctions will be applied where allegations are substantiated Range of sanctions enforced in accordance with the provisions of applicable IFAD rules and regulations and legal instruments Applies to IFAD-funded activities whether supervised directly by IFAD or by a cooperating institution

Anti Corruption Policy IFAD will continue to improve its internal controls, including controls inherent in or pertaining to its project activities, so as to ensure that it is effective in preventing, detecting and investigating fraudulent, corrupt, collusive and coercive practices. IFAD shall take all possible actions to protect individuals from reprisals who help reveal corrupt practices and individuals or entities subject to unfair or malicious allegations. This policy is in line with the policies adopted by the other IFIs

Anti Corruption Policy Corrupt practice Fraudulent practice Collusive practices Coercive practice

Anti Corruption Policy Corrupt practice = offering, giving, receiving, soliciting (directly or indirectly) anything of value to influence action of public official during procurement process Fraudulent practice = misrepresentation or omission of fact (prior to or after submission of proposal) to influence the process Collusive practices = scheme or arrangement between two or more bidders to establish bid prices at a non-competitive level Coercive practice = harming persons or their property to influence their participation in the process

Anti Corruption Policy Red Flags of fraud / corruption Persistent high prices Poor quality works Unnecessary agents ( middlemen, local partners ) Inadequate/incomplete documentation Lack of or inadequate inspections Project official micro managing

Anti Corruption Policy In case of fraud and corruption, IFAD will: a. Reject award recommendations b. Cancel relevant portion of loan if borrower fails to take action c. Sanction firms or individuals involved and declare ineligible for stated or indefinite period of time IFAD has the right to require a provision in the bidding documents / RFP enabling IFAD s inspection and audit of accounts related to contract

Anti Corruption Policy How to combat the problem: Acknowledge Prevent: Training; contractor compliance; voluntary disclosure programs Transparency: Project financial details, checks & balances Encourage and facilitate reports of concerns Enforce sanctions: withhold payments; refer violators for prosecution

Anti Corruption Policy IF YOU HAVE ANY INFORMATION ON CORRUPTION PRACTICES IN IFAD-FINANCED PROJECT, PLEASE CONTACT: Confidential online complaint form: www.ifad.org/governance/anticorruption