The Kenyan unit of global consultancy and professional services firm Ernest & Young will miss out on World Bank Group financed projects for the next 30 months in a settlement agreement after the company admitted to accounting for illegal payments and not disclosing conflict of interest in several projects.
- According to the lender, the debarment is in connection with sanctionable practices as part of the Somali Core Economic Institutions and Opportunities Program (SCORE) and the Second Public Financial Management Capacity Strengthening Project (PFM II) in Somalia.
- SCORE was designed to improve the enabling environment for private and financial sector development, and catalyze private investment and job creation.
- PFM II aimed to establish and strengthen systems of domestic revenue mobilization, expenditure control, and accountability in the Federal Government of Somalia, Puntland State of Somalia, and Somaliland State.
According to the World Bank, EY Kenya failed to disclose a conflict of interest during the selection and implementation of four contracts under the SCORE and PFM II projects, and the involvement of an agent in those contracts.
In addition, during the execution of one of the contracts, EY Kenya made a provision for allowances to be paid to project officials. This constitutes fraudulent and corrupt practices under the WBG Consultant Guidelines.
The debarment makes EY Kenya and any affiliates it controls ineligible to participate in WBG-financed projects and operations for the next two and a half years.
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.
This includes developing and implementing an integrity compliance program that reflects the principles set out in the WBG Integrity Compliance Guidelines. The company also commits to continue to fully cooperate with the WBG Integrity Vice Presidency.
The settlement agreement also provides for a reduced period of debarment in light of the company’s admission of the misconduct and cooperation, aspects of its existing integrity compliance program and voluntary remedial actions-including disciplinary action against the staff involved in the misconduct and voluntary restraint from bidding for WBG-financed contracts during the settlement agreement negotiations.
The debarment of EY Kenya qualifies for cross-debarment by other multilateral development banks under the Agreement for Mutual Enforcement of Debarment Decisions that was signed on April 9, 2010.
Other Kenyan based companies that have faced World Bank debarment include Techno Brain Kenya which faced 28-month debarment in 2020. Techno Brain Kenya and Techno Brain UAE engaged in an arrangement to obtain and edit confidential bidding documentation so as to influence the awarding of a contract in their favor. Techno Brain Kenya was subsequently awarded the contract, even though its bid did not meet tender requirements, thus necessitating a substantial reduction in the extent of work provided under the contract.
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