The World Bank Group has announced a 30-month debarment of Ernst & Young Kenya over fraudulent and corrupt practices.
In a statement, the World Bank said that the company was involved in sanctionable practices in ongoing projects in Somalia.
The projects include the Somali Core Economic Institutions and Opportunities Program (SCORE) and the Second Public Financial Management Capacity Strengthening Project (PFM II).
The company provides various services including assurance, tax, consulting, advisory and information technology.
“SCORE was designed to improve the enabling environment for private and financial sector development and catalyze private investment and job creation,” the statement read in part.
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World Bank Explains the Fraud
The statement explained that the PFM project in Somalia was meant to establish domestic revenue mobilization in the federal government of Somalia.
Additionally, the company was tasked with strengthening expenditure control, and accountability in the government, Puntland State of Somalia, and Somaliland State.
However, Ernst & Young failed to disclose a conflict of interest during the implementation of the contract and the involvement of agents- according to the World Bank.
“In addition, during the execution of one of the contracts, EY Kenya made a provision for allowances to be paid to project officials.
“This conduct constitutes fraudulent and corrupt practices under the WBG Consultant Guidelines,” the statement read in part.
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Withdrawal of Finances
At the same time, the World Bank indicated that it would not participate and finance projects and operations of the Kenyan based company.
Moreover, it explained that the move was part of its conditions to ensure achievement of specified integrity compliance conditions.
“The debarment makes EY Kenya and any affiliates it controls ineligible to participate in WBG-financed projects and operations.
“It is part of a settlement agreement under which the company admits culpability for sanctionable practices and agrees to meet specified integrity compliance conditions as a requirement for release from debarment,” said the World Bank.
Furthermore, the World Bank noted that the company admitted to the misconduct and voluntarily took action.
“Including disciplinary action against the staff involved in the misconduct—and voluntary restraint from bidding for WBG-financed contracts during the settlement agreement negotiations,” added the statement.
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