African Development Bank debars Chongqing International Construction Corporation for fraud
The African Development Bank Group (AfDB) has announced the debarment of Chongqing International Construction Corporation (CICO) for a minimum period of twelve months.
An investigation conducted by the AfDB’s Office of Integrity and Anti-Corruption established that CICO engaged in a fraudulent practice in bidding for works contracts in the context of an AfDB-financed road project in Uganda: 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.