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AfDB ousts Chinese Construction firm in Uganda over fraud

An investigation conducted by the AfDB’s Office of Integrity and Anti-Corruption established that CICO engaged in a fraudulent practice.

AfDB ousts Chinese Construction firm in Uganda over fraud

An investigation conducted by the AfDB’s Office of Integrity and Anti-Corruption established that CICO engaged in a fraudulent practice.

24 August 2017 Thursday 11:47
AfDB ousts Chinese Construction firm in Uganda over fraud

By Azania Post Reporter

A renowned Chinese Chongqing International Construction Corporation (CICO) has been disqualified for a period of one year over road project fraud practices in Uganda, East Africa.

The company was found to engage in fraudulent project practice in bidding for works contracts in the context of African Development Bank Group (AfDB) –financed road project in Uganda.

An investigation conducted by the AfDB’s Office of Integrity and Anti-Corruption established that CICO engaged in a fraudulent practice.

The bank said in a statement that in order to meet the pre-qualification requirements of the tenders, CICO inflated its purported experience with similar projects, grossly overstating both the scope and the value of contracts it had supposedly successfully completed in the past.

Upon expiry of the debarment period, CICO shall be released provided that the company adopts and implements a comprehensive integrity compliance program that meets the standards of the AfDB.

The AfDB will verify the adequacy of CICO’s compliance framework prior to any release decision.

“It is the duty of the African Development Bank to ensure that the funds it receives from donors are used exclusively to further the socio-economic development of the institution’s regional member countries.

CICO will therefore remain debarred until the Bank is assured that it is not putting funds at risk by doing business with this company”, explains Bubacarr Sankareh, acting Director of the Office of Integrity and Anti-Corruption.

In 2013, CICO participated in tenders for works contracts under the AfDB-financed Road Sector Support Project in Uganda.

In order to prequalify for the tenders, CICO was required to show that it had successfully completed at least four similar projects in the previous five years. In pursuance of this objective, CICO inflated the scope and the value of its reference contracts:

For example, a contract for a road of 4.4 kilometers was falsely presented as having been 68 kilometers in length. In another instance, the value of a reference contract was erroneously inflated from just about US$17.5 million to approximately US$79 million dollars in order to meet the prequalification criteria.

The African Development Bank Group views corruption, fraud and other sanctionable practices as highly inimical to the achievement of its mandate.

In order to spur sustainable economic development and social progress on the continent, AfDB endorses a multipronged approach to combating these harmful practices.

Consequently, IACD uses proactive measures including risk assessments and sensitization programmes to deter sanctionable practices and prevent their occurrence in internal corporate procurement issues and operations financed by the Bank Group.

The Integrity and Anti-Corruption Department has the overriding mandate to carry out independent investigations into allegations of corruption, fraud and other sanctionable practices in Bank Group Financed Operations. “Bank Group Financed Operations” are internal corporate procurement issues and operations financed by the Bank Group.

The Department also develops preventive measures to proactively reduce the potential for corruption, fraud, misconduct and other sanctionable practices within Bank Group Financed Operations.

Azania Post

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