Ex-USAID contractor, wife sentenced in $1 million embezzlement
A former deputy director at a private contractor that did business with the U.S. Agency for International Development (USAID) was sentenced Friday to 51 months in prison in the
embezzlement of more than $1 million from a program meant to address global health problems. Mark Adams, 44, and his wife, Latasha Bell, 36, both of Fort Washington, each pled guilty in October before U.S.
District Judge Beryl A. Howell in
federal court in D.C. to
one count of conspiracy to commit wire and mail fraud. Court records show the couple used money intended to save lives from terrible diseases to,
among other things, renovate their home and buy luxury automobiles...
Court records show he also admitted that his false invoices generated more than $1.08 million
in fraudulent payments between 2006 and 2010. The bogus invoices claimed to bill for services from Bell and
companies controlled by Adams’s friends, including co-conspirator Everett Lipscomb Jr. But the records show that the work and services
claimed on the invoices were not provided...Adams and Bell also
used fraudulent invoices to pay a home renovation contractor to complete an extensive renovation of their home. In another
instance, the records show, Adams and Bell received
funds that they used to buy a luxury automobile.
INTERVIEW: World Bank's top cop gets creative in cleaning up business
Stephen Zimmermann says he needs more help from national authorities in
fighting corruption on projects to end global poverty if his office is to have real impact...Of the 42 entities that were
barred from doing business with the World Bank last fiscal year, 69 percent of the cases were for fraud, which critics say
is a relatively simple to prove if there is an altered bidding document or bank statement. Zimmermann said that very
often the case starts out as one of suspected corruption and collusion, but his team faces investigative hurdles and are unable
to gather sufficient proof.
World Bank Cracks Down on Corruption Amid Leadership Change
The World Bank sanctioned 83 entities in 2012 for fraud or corruption
on bank projects, a 247% increase from 2011 , according to an annual report released Tuesday. The statistics underscore the
heightened emphasis on anti-corruption efforts at the World Bank in recent years...The number of businesses, non-governmental
institutions and individuals debarred from World Bank projects increased to 83 from 32 in 2011. Since the World Bank established
its punishment system in 1999, more than 541 firms and individuals have been sanctioned for fraud, corruption or collusion.
Most come in the form of debarments, which render those designated as such ineligible to participate in Bank-financed operations.
World Bank names former ICC prosecutor to head corruption panel
The former chief prosecutor of the International Criminal Court will lead a review of Bangladesh's
investigation of alleged corruption tied to a major bridge project, the World Bank said. Luis Moreno Ocampo will head the
three-member panel and deliver a report to the World Bank, one of several steps necessary for the Washington-based development
institution to resume its $1.2 billion line of credit. Ocampo sought to prosecute individuals for crimes against humanity
at the ICC, located in The Hague, Netherlands. The World Bank canceled funding for the Padma River development in Bangladesh
in June, saying it had "credible evidence" of high-level corruption among Bangladeshi government officials.
The World Bank battles corruption in Bangladesh
For months now, the World Bank and the government
of Bangladesh have been sparring over a planned Bank loan to help construct a bridge over the Padma River. The Bank backed
out of the project in June, insisting that it had uncovered evidence of high-level corruption. Specifically, the Bank alleged
that representatives of a major Canadian engineering firm bribed Bangladeshi officials (Canadian authorities are reportedly investigating two firm executives). The Bank's move produced outrage
in Bangladesh, which insisted that it would find other financing.
More quietly, however, conversations about how
to address the Bank's concerns proceeded. The Bank presented a stiff list of conditions: Bangladesh would have to suspend
all officials suspected of corruption, initiate a special investigation domestically, and give an international expert panel
access to all relevant information. Last week, the international lender reported that the Bangladeshi authorities had begun fulfilling
INTERPOL and the World Bank vs. Corruption
Any observer of anti-corruption drives
can attest that with such efforts usually comes a measure of . . . corruption. How does it happen?
- First, a government official is charged with the duty of rooting
out corruption, and such rooting may target bribery, fraud, embezzlement, and the like.
- When officials begin to prosecute such crimes, the public is often
quite supportive of those actions, and governments are allowed a bit more wiggle room in their law enforcement activities
than they might otherwise have.
- Once the anti-corruption activity gains steam, it sometimes takes
on the taint of the very corruption it seeks to eliminate. Officials feel emboldened to act in ways that are technically
illegal, but seem palatable in an "end justifies the means" sort of way.
The anti-corruption effort can be used
as a shield to cover politically motivated criminal charges
U.S. official says government wasted $6-8 billion in Iraq reconstruction
The official in charge of monitoring America’s $51 billion effort to reconstruct Iraq
has estimated that $6 billion to $8 billion of that amount was lost to waste, fraud and abuse...more than
11 percent of the billions spent...
Inspector General for Iraq Reconstruction (SIGIR) said
the exact funds lost to fraud and waste “can never be known,” largely because of poor record-keeping by
the U.S. agencies involved in the effort. These include the Departments of State and Defense, along with the U.S. Agency for
...auditors repeatedly found that the State Department and Defense Department
failed to properly review invoices from government contractors, often approving billions of dollars in services without checking
if costs were accurate or efficient...the cost of many contracts was steadily
increased due to frequent modifications...many agencies sometimes skipped appropriate review of their bills in an effort to spend money within a deadline,
so they did not have to return it to the Treasury...
The report lays much of the blame on a lack of manpower dedicated to reviewing
and overseeing government contracts. The State Department enlisted a single contracting officer to handle a $2.5 billion deal
with DynCorp International to train Iraqi police forces, for example...
SIGIR’s investigation also uncovered instances of bid-rigging and
bribe-taking by State and Pentagon officials. Fraudulent activities uncovered by the special
inspector general resulted in 87 indictments, according to the report. Of those cases, 61 involved contract kickbacks, 11 involved contract fraud, and nine were related
to embezzlement. Both military officers and defense contractors were frequently implicated.
U.S. audit: $200M wasted on Iraqi police training
Whistleblowers in the United Nations ---- Victory for James Wasserstrom, the UN's leading whistleblower
James Wasserstrom was posted
to Kosovo to fight corruption. In 2007 he started raising concerns about what he saw as misconduct involving links between
UN officials and a local utility company. His worries were ignored. After he complained to the UN’s oversight office,
he says, his boss cut his staff, in effect abolishing his job, and had him investigated for misconduct. That culminated in
his detention, the search of his house and car, and other indignities...
... after a long and costly
legal battle that unearthed documents backing Mr Wasserstrom’s case, the UN’s new Dispute Tribunal overturned
that. Without ruling on the alleged corruption, Judge Goolam Meeran, in a blistering judgment, said “any reasonable
reviewer” would have spotted the clear conflicts in the UN’s evidence and demanded, at the least, more investigation
of the complainant’s treatment. Now an anti-corruption officer at America’s embassy in Kabul, he stands to gain
$1m in damages, plus costs.
He is particularly critical
of top officials, including the secretary-general, Ban Ki-moon, for “deliberately undermining what they claim is support
for whistleblowers” for footdragging and for misleading the General Assembly in these respects. “They clearly
never expected that I would force them into court,” he said.
Corruption at the heart of the United Nations: An investigation has concluded that the former head of the United Nations'
oil-for-food programme in Iraq took kickbacks to help an oil company win contracts
The report is a severe blow to the organisation at a crucial
time...An independent commission has found that Benon Sevan, the former head of the
UN’s oil-for-food programme in Iraq, “corruptly benefited” from kickbacks while he was in charge. Another
UN official, from the procurement office, is accused of soliciting bribes. The UN’s biggest-ever
humanitarian undertaking seems to have become its biggest-ever scandal...
The Volcker committee also says it has evidence that Mr Yakovlev took hundreds
of thousands of dollars from other UN contractors. He and Mr Sevan are now the first two UN officials to be directly accused
of personally benefiting from corrupt activity.
Summary of the Iraq/United Nations Oil for Food Scandal (from Wikipedia)
The Oil-for-Food Programme (OFF),
established by the United Nations in
1995 was established with the stated intent to allow Iraq to
sell oil on the world market in
exchange for food, medicine, and other humanitarian needs for ordinary
Iraqi citizens without allowing Iraq to boost its military capabilities...
In addition to criticism of the basic approach, the programme
suffered from widespread corruption and abuse. Throughout its existence, the programme was dogged by accusations that some
of its profits were unlawfully diverted to the government of Iraq and to UN officials...
scheme is alleged to have worked in this way: individuals and organizations sympathetic to the Iraqi regime, or those just
easily bribed, were offered oil contracts through the Oil-for-Food Programme. These contracts for Iraqi oil could then be
sold on the open world market and the seller was allowed to keep a transaction fee, said to be between $0.15 and $0.50/barrel
(0.94 and 3.14 $/m³) of oil sold. The seller was then to refund the Iraqi government a certain percentage of the commission.
to sell Iraq humanitarian goods through the Oil-for-Food Programme were given to companies and individuals based on their
willingness to kick back a certain percentage of the contract profits to the Iraqi regime. Companies that sold commodities
via the Oil-for-Food Programme were overcharging by up to 10%, with part of the overcharged amount being diverted into private
bank accounts for Saddam Hussein and other regime officials and the other part being kept by the supplier.
involvement of the UN itself in the scandal began in February 2004 after the name of Benon
Sevan, executive director of the Oil-for-Food Programme, appeared on the Iraqi Oil Ministry's documents. Sevan allegedly
was given vouchers for at least 11,000,000 barrels (1,700,000 m³) of oil, worth some $3.5 million in personal profit. Sevan
has denied the charges.
FORBES: World Bank Spinning Out Of Control - Corruption, Dysfunction Await New Head
...economic superpower China remains one of the bank’s largest
and most valued clients, even as it doles out development money to other countries and bullies the bank from aggressively
Internal reports, reviewed by FORBES, show, for example, that even
after Zoellick implemented a budget freeze some officials operated an off-budget system that defies cost control, while others
used revolving doors to game the system to make fortunes for themselves or enhance their positions within the bank...
The bank, those inside and outside it say, is so obsessed with
reputational risk that it reflexively covers up anything that could appear negative, rather than address it. Whistle-blower
witch hunts...undermine the one sure way to root out problems at a Washington headquarters dominated by fearful yes-men and
yes-women, who–wary of a quick expulsion back to their own countries– rarely offer their true opinions...
The bank’s corruption fighters are too focused on specific
development projects and not enough on the budgets of poor countries, where bank funds–more than $50 billion since 2008–are
commingled with a country’s income and may not be used for its intended purpose. These funds go down a rabbit hole and
are almost impossible to track...
...a 2006 study, however, Lerrick drilled down into the bank’s
books and found real annual losses of $100 million to $500 million per year on its loans–although accounting maneuvers
painted a rosier picture of the financials...
“Trust funds” are the World Bank’s dirty little
secret, their version of Congressional earmarks. There are hundreds of them, funded by dozens of countries and dedicated to
virtually every poverty-type project you can think of. And they have been growing so phenomenally that they now provide $600
million annually, or 30% of the bank’s total administrative budget...
since they have various arms of the bank administering these funds,
there’s even less oversight than there would have been otherwise. And while those trust funds are generally not supposed
to go toward administrative overhead, they often do anyway, say bank insiders, which many countries are unaware of. FORBES
has turned up examples–such as with Italy–in which arms of the bank have been charging headquarters and individual
countries for the same salaries and expenses, helping to enrich bureaucratic fiefdoms.
FORBES has also discovered a whole layer of bank officials who
have learned how to game the system or expand their influence through its constantly revolving doors...
it’s not shocking that last December more than $2 billion
suddenly started appearing, disappearing and reappearing across the online budget accounts (and computer screens) of bank
units around the world, according to staffers responsible for those budgets. In some accounts they showed huge deficits where
none had been, while in others there were sudden surpluses. This was popping up in unrelated units across the bank’s
computer networks–and driving everyone crazy trying to figure out what was happening...It eroded confidence in the World
U.N. Report Flags Afghanistan Fraud
The United Nations
agency that administers a trust fund bankrolling Afghanistan's police allowed procurement fraud to flourish for several years,
according to an internal U.N. report seen by The Wall Street Journal. The report, which hasn't been made public, casts new
light on possible mismanagement at a U.N. office that has channeled billions of dollars into the country since 2002. It also
raises new questions about the international community's role in Afghanistan at a delicate moment: U.S. and international
troops are departing next year, just as the country is bracing for a high-stakes election to pick President Hamid Karzai's
successor. At issue is the Law and Order Trust Fund for Afghanistan, or Lotfa, a fund administered by the U.N. Development
Program that covers payroll and benefits for the Afghan National Police. Started in 2002, Lotfa has overseen the delivery
of around $2.5 billion to help bankroll and build the Afghan police force. Last year, international monitors raised concerns
about suspected fraud at the fund, allegations first reported by The Wall Street Journal. The reports caused a major credibility
problem for the U.N. in Afghanistan: Lotfa had previously been touted as a model for international assistance. At the time,
the European Union put tens of millions of dollars in anticipated donations to Lotfa on hold amid the investigation.
BBC Documentary Exposes Corruption and Abuse in Afghan Police Force
A BBC documentary has uncovered evidence
of abuse by the Afghan police force in Helmand province. Reporter Ben Anderson spent
five weeks following a group of US Marines who
are advising the police in Sangin district before the hand-over of power is completed there next month. He discovered evidence
of some shocking behavior including corruption, kidnap, drug use, murder and child abuse.
Afghan corruption imperils future success
The U.S. has spent more on reconstruction in Afghanistan than
in any other foreign country, says John Sopko, special inspector general for Afghanistan reconstruction. Sopko says the U.S.
is spending about $28 million a day on reconstruction projects, which has amounted to close to $100 billion over the past
decade... much of the reconstruction effort has been wasted because of mismanagement and corruption. Recently, Sopko said
that his agency's job is to protect U.S. funds from fraud, mismanagement and abuse. Then he noted a series of abuses where
buildings collapsed, where contractors disappeared with funds, and where projects were funded in areas that could never be
monitored for security reasons. He admitted, "We are at risk of wasting billions of dollars."
Special IG for Afghan reconstruction cites rampant fraud, waste
Much of the $28 million the United States spends daily to build up Afghanistan is thrown at projects
without planning, and little attention is paid to whether the work ever gets done right, the U.S. official in charge of oversight
of Afghan reconstruction said Thursday. Meanwhile, security is so bad in many areas that keeping watch over projects is nearly
impossible, while bribes and corruption continue to flourish, said John Sopko, who in July took over the job of Special Inspector
General for Afghan Reconstruction, or SIGAR. In his first public speech since his appointment, he painted a grim picture of
the state of the U.S. campaign to remake Afghanistan, an effort that has cost thousands of U.S. lives and hundreds of billions
of dollars. The quarterly reports that Sopko, a longtime prosecutor and congressional counsel, has since issued form a counterpoint
to more optimistic assessments coming from the Pentagon and other parts of the U.S. government. In order to wisely use U.S.
taxpayer money to reconstruct Afghanistan, U.S. military and civilian officials need to start asking tough but simple questions,
Sopko told an audience at the Stimson Center, a Washington, D.C.-based think tank focused on global security issues. “Are
these programs and buildings needed? Have you asked the Afghans if they want them?” he said. “Have we designed
them to meet any specific needs that the Afghans have? And have we designed them in such a way that they can be sustainable
in the future?”
INSPECTOR GENERAL: Afghan fuel records go missing
What happened to almost $475 million worth of oil destined for
the Afghan National Army...Unfortunately, the inspectors may never find out. According to the report released Monday,
more than four years of financial records that the Department of Defense was supposed to keep to track this spending are either
missing or so poorly kept that even gathering basic information, such as the location and size of fuel sites, was not possible.
The report concludes that the Department of Defense agency in
charge of tracking the oil “does not have accurate or supportable information on how much U.S. funds are needed for
[Army] fuel, where and how the fuel is actually used, or how much fuel has been lost or stolen.”
AFGHAN AID: Donors Losing Billions to Corruption
As much as $1 billion of the $8 billion donated
in the past eight years has been lost to corruption.
Corruption in the country is nothing new, but it is
worsening. Afghanistan has had a long history of conflict, contraband and war. It falls almost at the bottom of the list of
the most corrupt and poorly governed countries...
Estimates...show bribe payments — for everything
from enrolling in elementary school to getting a permit — doubled between 1997 and 2009, topping $1 billion a year.
Corruption and black-market trading, which is closely linked to drugs and arms trafficking, have reached over $12 billion
In recent years, key donors have provided technical
and financial support for anti-corruption programs. But their efforts have not always been appropriate in the Afghan context,
sufficiently coordinated, or integrated with other reforms...
Afghanistan Contractor Accountability Bill Introduced
Afghan corruption rife, House panel told
American tax dollars are funding widespread corruption
in the Afghan military and police, a Middle East specialist told a House panel...Bribes, embezzlement, “no-show” jobs and the re-sale
of donated equipment and ammunition are commonplace among Afghan soldiers and police officers...Nearly 90 percent of Afghanistan’s GDP comes from international aid.
Is corruption the cost of saving Afghanistan?
In fact, there
is virtually no chance that the Afghan government will tackle corruption – and everyone knows it. President Hamid Karzai
has made similar commitments for years, yet not a single high-level official has been convicted for graft, in a country whose
public sector ranks as the third-most corrupt in the world, according to Transparency International.
unspoken reality is that the United States, which drives international policy on Afghanistan, appears to have resigned itself
to this kleptocracy. Back in 2010, U.S. President Barack Obama tried to pressure the Afghan leader into tackling corruption,
but his efforts served only to worsen relations between the two countries, and he soon backed off...Washington seems to have decided that a kleptocratic
Afghan government is better than no Afghan government...
Afghan aid often goes to white elephants and to line pockets
The U.S. Special Inspector
General for Afghanistan Reconstruction
claims that Washington has failed to account for billions spent on projects.
projects were six Afghan National Police buildings so poorly made they could not be used. A Kabul Power plant costing 300 million
of U.S. taxpayer funds encountered years of delays and cost increases and now that it is built is used only as an expensive
U.S. Wages Sisyphean War Against Afghan Corruption
U.S. construction projects in Afghanistan challenged by inspector general's report
7 Officials in Afghan Investment Agency Quit, Protesting Graft