World Bank Puts Armenian Fraud Case on Hold
After first being covered in the blogosphere, Bruce Tasker’s allegations of corruption in a World Bank project in Armenia have now hit international headlines with the U.K.’s The Observer carrying a story today. Interestingly, Tasker approached local Armenian media outlets such as Armenia Now and Hetq Online, as well as local NGOs such as the Center for Regional Development/Transparency International Armenia (CRD/TI Armenia), with these allegations just before the May parliamentary election, but none followed up on the hundreds of pages of evidence that Tasker says he has.
Frustrated, in lieu of any media outlet here interested in the allegations, Tasker then set up his own blog to disseminate the information he had instead. Tasker also approached this blog and after assessing the documents he provided, Oneworld Multimedia concluded that this story should be presented to the public. An email to the World Bank office in Yerevan was less than adequately responded to, and the response from the Washington-based Government Accountability Project (GAP) backed up Tasker not only with regards to his allegations, but also in further claims of blacklisting by the international banking organization.
Hetq Online eventually covered the allegations in August, albeit only after reading posts made on this blog first, but an English translation was never made available to a non-Armenian speaking audience. At any rate, Tasker’s allegations were only covered by the online publication after it was first exposed on his own blog as well as this one. Highlighting the importance of bloggers in reporting such stories, Notes from Hairenik, Martuni or Bust, and Nazarian also covered the story that was otherwise ignored by media outlets and local NGOs perhaps too dependent on foreign donors.
Anyway, my article for New Internationalist will be published in the November edition of the magazine, but in the meantime, The Observer’s Economics Editor, Heather Stewart, also covers the story.
Britain is urging the World Bank to investigate allegations of corruption and embezzlement in a $35m (£17m) water project in Armenia, which the Washington-based body says are only of ‘medium priority’. Bruce Tasker, a British whistleblower, says he has presented the bank with evidence of large-scale fraud in a project to improve the water supply in the Armenian capital Yerevan, but it has so far refused to carry out a full-blown investigation.
With its conciliatory new boss Robert Zoellick at the helm, the World Bank is keen to make a fresh start after the humiliating departure of Paul Wolfowitz earlier this year. Wolfowitz stormed into the bank promising to crack down on corruption, but ended up being embroiled in an ethics scandal of his own concerning lavish pay rises for his girlfriend, Shaha Riza.
Persuading the world’s richest countries that their taxpayers’ money is being well spent is a critical part of Zoellick’s job, but the Armenian case is just one of a backlog of allegations waiting to be examined by the Bank’s Institutional Integrity Department - or INT, as it is known.
INT wrote to Washington-based pressure group the Government Accountability Project (Gap), which is backing Tasker’s claims, saying the case was ‘rank ordered “medium” priority, and as such remains in a queue pending the availability of investigative resources’.
The British Ambassador in Armenia has written to the World Bank, urging it to carry out a full investigation.
‘We’ve run into a wall,’ said Gap’s director, Bea Edwards. ‘We have extensive documentation. It involves high-level government officers, a lot of money and basic services. What else do they want? They’ve been completely unhelpful.’
She says the Armenian case is important, because it could point to potential problems in the way other World Bank projects are run, particularly in the former Soviet Union.
Tasker is a British engineer appointed by an Armenian parliamentary commission investigating the Yerevan scheme. He claims that as soon as he began to examine the details of the project, it became clear that it was riddled with corruption, ‘from start to finish, from top to bottom. The fact is it was not an isolated case of a few thousand dollars here or there, it was tens of millions of dollars.’
The original purpose of the project was to repair Yerevan’s pipelines, and improve the water supply to households, but he says that by the time the work got under way it had shifted to installing water meters instead.
Tasker claims contractors were able to pocket up to $10 profit on the sale of each meter by charging customers for installation. His commission was told that the average number of water meters per customer was 1.5.
[…]
Jeff Powell, of pressure group the Bretton Woods project, said it was still too often left to politicians to decide which allegations to pursue. ‘This case is indicative of the fact that senior management and the board of the World Bank have not taken seriously the issue of corruption,’ he said.
A World Bank spokesman said he would not comment on a specific case.
The full story is here, and it’s worth pointing out that Tasker’s blog, Blowing The World Bank Whistle, is now available in Armenian. Oneworld Multimedia’s coverage is here. With so much information now available, and especially since GAP made specific reference to Tasker’s claims in its recent report, I wonder if the local media here will finally start to take these allegations seriously?
The wheels of justice never did grind quickly. What ashame it took so long to get any sort of notice- and a victory for the blogosphere without which I’m sure this story would have never gotten anywhere. Makes you wonder about the huge number of violations now and in the past which have gone undetected or not reported on because, despite evidence, just couldn’t get any traction or interest. Blogs help grease the gears a little.
Comment by Paul — September 30, 2007 @ 6:54 pm
In addition to the urgent need for media outlets here to take up the issue, especially after a major report released in Washington earlier this month detailed the allegations, the Observer now carries an article, and my New Internationalist piece will be published next month, I’d also like to see questions raised in parliament about the initial findings of the parliamentary commission now that the same allegations have come to light.
Dashnaktsutyun might also want to raise the issue with Vahan Hovannisian considering he is one of two candidates under consideration by the party for next year’s parliamentary vote and the fact that after a highly publicized statement from him after the commission discovered these allegations in 2004 was followed with no further action. Instead, he went silent and did nothing.
Indeed, Tasker writes about that here:
Anyway, as Tasker’s blog is available in English and Armenian, there is really no reason for the media here to ignore what is fast becoming a high profile case study in the World Bank’s refusal to properly investigate allegations of corruption in its projects. Well, high profile outside of Armenia, but ironically not in the country where the corruption is alleged to have taken place and where citizens and consumers continue to pay the price.
Comment by Onnik — September 30, 2007 @ 7:28 pm
Last week I received a message from Transparency International’s Amalia Konstanyan, in which she writes that she has never turned down an offer to support this action. Amalia writes that TI is moving office this week, but after that she will be ready to meet to discuss the TI involvement.
Let us hope that TI is ready to actively support this action.
We will soon see.
Comment by Bruce Tasker — October 2, 2007 @ 1:20 am
Well, Bruce, what can I say other than it’s about time…
However, in my opinion they should have been on the ball long ago rather than wait before others bothered to do their job for them first.
Comment by Onnik — October 2, 2007 @ 1:43 am