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141 Banking L.J. 299 (2024)
World Bank Group's Watchful Eye: A Reminder of How Minor Ethical Breaches Can Result in Major Problems

handle is hein.journals/blj141 and id is 327 raw text is: World Bank Group's Watchful Eye: A Reminder of How Minor Ethical Breaches Can Result in Major Problems By Brian L. Howard II, Andreina Escobar and Aurra Fellows* In this article, the authors discuss the anti-fraud and anti-corruption regulations of multilateral development banks. While much attention is given to compliance with applicable laws, such as the U.S. Foreign Corrupt Practices Act of 1977, many companies working on projects sponsored by multilateral development banks (MDBs or MDB) overlook that they have subjected themselves to an entirely separate regime of anti-fraud and anti-corruption regulations with serious consequences for non-compliance. These regulations can exceed the requirements of the appli- cable laws in some areas, and MDBs have a history of enforcing regulatory breaches that would not interest most government regulators. WORLD BANK The World Bank Group's enforcement arm, the Office of Suspension and Debarment (OSD), has had a strong 2024 so far - since January, it has added more than 60 new entities and individuals to its Listing of Ineligible Firms and Individuals.' Such debarred entities and individuals are prohibited from participation or nomination of any kind in projects receiving funding from the World Bank Group or, in most cases, any other MDBs, including as a subcontractor, consultant, supplier, or service provider.2 Additionally, any loans already given can be cancelled. This robust enforcement serves as a stark The authors, attorneys with Vinson & Elkins LLP, may be contacted at bhoward@velaw. com, aescobar@velaw.com and afellows@velaw.com, respectively. Procurement - World Bank Listing of Ineligible Firms and Individuals, The World Bank Group, https://www.worldbank.org/en/projects-operations/procurement/debarred-firms (last vis- ited April 10, 2024). Published on the World Bank Group's website, this listing compiles all individuals or entities ineligible for World Bank Group-financed projects due to violations of the World Bank Group's anticorruption guidelines and policies. 2 The need for effective compliance programs is especially crucial as the World Bank Group and other MDBs have agreed to enforce each other's debarments in cases where the debarment exceeds one year. In other words, one-year and longer debarments from the World Bank Group or another MDB would also be automatically adopted by all the other MDBs without an opportunity for advocacy or argument, including by the Asian Development Bank, African Development Bank Group, European Bank for Reconstruction and Development, and Inter- American Development Bank Group. 299

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