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Sanctions are decisions made by the Bank Group that penalize individuals or firms for proven commission of sanctionable practices. The Bank Group’s sanctions system is strictly of an administrative nature and made independently of the investigative process. Sanctions are applied based on the principle of proportionality and considers mitigating and aggravating factors. Sanctions include reprimands, debarment, restitution, etc. Debarment is a decision to declare an entity ineligible to bid or be awarded future contracts administered, financed or supported by the African Development Bank Group.
The Bank Group may also recognize sanctions made by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions. Flowing from its commitment to this Agreement, the AfDB may debar an entity found to have participated in certain sanctionable practices by another multilateral bank. Additional information on this agreement is provided under the Initiatives section.
Decisions to sanction individuals or entities based on IACD’s investigative reports are made independently of the investigative process. The African Development Bank Group operates a two-tiered process to impose penalties for proven commission of sanctionable practices in projects administered, financed or supported by the Bank Group. Upon the completion of investigations relating to allegations, IACD forwards the investigative report to the Sanctions Commissioner, who makes an initial determination and, where applicable, a sanction decision. The individual or entity may appeal the decision of the Sanctions Commissioner to the Sanctions Appeals Board. There is no further appeal from the decision of the Sanctions Appeals Board.
Where the investigations relate to the allegations of sanctionable practices by Bank Group staff relating to operations financed by the Bank Group, its administrative budgets and misuse of Bank resources, IACD will forward its findings to the President. This will be administered under the Bank’s disciplinary framework.
The sanctions system of the Bank Group was adopted by the Executive Board of Directors on the 5th of July 2012.
Sanctionable Practices have been defined in the Bank’s procurement policies as corrupt, fraudulent, collusive, coercive and obstructive practices in relation to Bank Group financed operations. These policies apply to individuals and firms. These practices are further defined below:
- Corrupt practice: The offering, giving, receiving or soliciting, directly or indirectly, of anything of value to influence improperly the actions of another party.
- Fraudulent practice: Any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a public official to obtain a financial or other benefit or to avoid an obligation.
- Collusive practice: An arrangement between two or more parties designed to achieve an improper purpose, including to improperly influence the actions of another party.
- Coercive practice: Impairing or harming, or threatening to directly or indirectly impair or harm any party or the property of the party, in order to improperly influence the actions of a party.
- Obstructive practice:
- Deliberately destroying, falsifying, altering, or concealing of evidence material to the investigation or making false statements to investigators in order to materially impede a Bank investigation into allegations of a corrupt, fraudulent, coercive, or collusive practice; and/or threatening, harassing or intimidating any party to prevent it from disclosing its knowledge of matters relevant to the investigation or from pursuing the investigation, or
- Acts intended to materially impede the exercise of the Bank’s inspection and audit rights
Reporting Sanctionable Practices
The African Development Bank Group mobilizes and allocates funds to regional member countries towards catalyzing socioeconomic progress on the continent. In order to achieve this mission, it is important that these funds be used for the purposes for which they were intended. The Integrity and Anti-Corruption Department safeguards the AfDB’s mandate by preventing and detecting corruption, fraud and other harmful practices, defined as sanctionable practices.
While IACD is the centre of the Bank’s fight against these harmful practices, the Bank recognizes that fighting against fraud and corruption is a collective effort. Consequently, in addition to its independent reviews, IACD strongly encourages persons involved in operations financed by the Bank Group to report suspicious activities. IACD.2 is the primary recipient of these allegations and will accept all information, whether provided anonymously or otherwise. IACD encourages complainants to provide identifying information that allows the Department to seek clarification of information received.
What to Report
IACD urges persons with knowledge of sanctionable practices relating to internal corporate procurement issues and operations financed by the Bank Group to report that information. The Bank recognizes five sanctionable practices: corruption, fraud, coercion, collusion, and obstructive practices. IACD also regularly updates a list of indicators of sanctionable practices
How to Report
IACD encourages detailed information in reports that allege the occurrence of sanctionable practices. Complainants may use the following questions as guidelines in making reports:
- What occurred? Provide a full description of the events with relevant details. Please note that summaries may omit relevant information.
- When did the event occur? Please state the date, time and other identifying information.
- Where did it occur? Kindly clearly identify the location or event where you believe the sanctionable practices have occurred. Include details such as country, state, region, office, sector, where applicable.
- Who are the individuals and/or entities involved? Please provide names and details of the persons or firms whom you believe are involved, implicated in, or have knowledge of the alleged sanctionable practices.
- How does it apply to the Bank Group? Explain how the allegation relates to its internal corporate procurement issues or operations financed by the Bank Group.
While IACD recognizes that complainants may not have complete information on the allegations made, it is important that complaints are made truthfully, accurately and given in good faith. Complaints may be made through secured means, including hotlines, facsimile numbers, email, the Bank’s website, and in person, at any time of the day. Please refer to the contact page for more information.
IACD encourages complainants to provide identifying information. Identifying information will enable IACD to request additional information and clarification for effective investigations of the allegations. IACD treats information received in the strictest confidence. Information relating to investigations are limited and circulated only on a need-to-know basis.
Further, the Bank has issued a Whistle Blower Complaints and Handling Policy that enhances the corporate governance process and protects complainants from reprisals. IACD manages this policy, and protects whistle blowers.