Magazine article Insight on the News

IDB Does the Corruption Dance. (the Watchers)

Magazine article Insight on the News

IDB Does the Corruption Dance. (the Watchers)

Article excerpt

Early last December Inter-American Development Bank (IDB) President Enrique Iglesias took the unusual step of sending a three-page memorandum to his entire staff. In it, the Uruguayan promised to refer for criminal prosecution by the U.S. Attorney's Office for the District of Colombia a consultant with the IDB Auditor General's Office accused of orchestrating a jobs-for-money kickback scheme first reported by INSIGHT. However, a month later, the prosecutor's office said it had yet to receive the IDB referral. Some bank insiders say there is a move afoot to delay doing so until the furor dies down, and then to let the matter quietly drop [see "IDB Frustrates U.S. Justice," posted Jan. 15 on INSIGHT Online]. These sources say there is concern that the longtime bank staffer accused of receiving the kickbacks might spill what he allegedly knows about other wrongdoing at the IDB, or that the prosecutor's office will use the referral to convene a grand jury looking into other corruption issues them.

Questions also are being raised by independent watchdog groups about Iglesias' rebuttal of other allegations of corruption INSIGHT brought to light concerning IDB-funded projects [see "Corruption Corrodes Development Banks" Oct. 15-28]. Iglesias admitted that problems had occurred in Nicaragua and Argentina; however, he argued that corruption issues there were minor. More serious, however, was Iglesias' suggestion that the Auditor General's Office, headed by the septuagenarian William Taylor, had not received any allegations about corruption in the Ecuadoran sanitation program, and that allegations about the Colombian projects were "unfounded. …

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