All Things Whistleblower: A GAP Blog

Weak Prescription for Improved World Bank Governance

This post was written by GAP International Reform Director Beatrice Edwards for her Daily Kos Blog.

On October 20th, the High Level Commission convened to assess governance at the World Bank transmitted its report, "Repowering the World Bank for the 21st Century," to World Bank president Robert Zoellick. The report concluded (more or less verbatim) that:

• Current mechanisms for strategy formulation are not adequate for setting priorities and guiding operations;
• Mission creep is endemic, weakening accountability and increasing the risk that resources will be misallocated;
• The decision-making process is perceived as too exclusive;
• Insufficient institutional accountability for results weakens the World Bank’s effectiveness and legitimacy;
• The Bank’s resource base is insufficient.

The 'accountability' concerns of the commission, headed by former Mexican president Ernesto Zedillo, are profound. Among other things, the commissioner's wrote, the Executive Board lacks the independence necessary for effective oversight.  The appointment of the president is "opaque and excludes most of the membership."  The conduct of the Bank president is unsupervised, executive directors are not necessarily competent or qualified, and accountability functions are a patchwork of ad hoc assignments.

Unfortunately, the commission produced only superficial recommendations to address all this.  Much of the suggested improvement consists – literally – of rearranging the chairs (on the board).  Board chairs would be switched around and reduced in number.  The president of the Bank would no longer sit in the chairman’s seat.  He would also be subject to a performance review (by the board).  A council of advisors would be established to counsel the president, but its composition "would mirror that of the Board."  The methods to be used to choose council members are unspecified.

To strengthen accountability, additional reviews will be conducted, presumably by similar High-Level Commissions confronting similarly defective arrangements.

This is not serious.  In 2007, cronyism was exposed in the office of the World Bank president: Paul Wolfowitz had installed a network of overpaid and underqualified advisors with carte blanche to intervene anywhere they pleased.  As a result, they wreaked havoc.

During his tenure, Wolfowitz established a position for his romantic partner at a ‘foundation’ putatively run by the US Department of State, paying the woman approximately $70,000 more per year than the salary earned by  the Secretary of State.  And, just as the dust settled from these adventures, his General Counsel took it upon herself to obliterate the autonomy of the Bank’s Ethics Office.

At the same time, emails surfaced suggesting that the Bank would defang its anti-corruption program after  push-back from the government of China.  Meanwhile, longstanding, widespread corruption came to light in Cambodia, the Philippines, India, Kenya and Viet Nam.

A year later, the General Services Division at the Bank was forced to disclose that its three principal IT vendors had been debarred for fraud and corruption.  One of them had bribed the Bank’s Chief Information Officer, who was also (nominally) debarred, and then compensated in the amount of $25,000 by the Bank for damage done to his reputation by the whole affair.

This year, the Bank’s Vice President for Institutional Integrity was exposed in the press for politicizing a high-level investigation in South Africa, an ethical lapse that directly affected the outcome of the recent presidential election there.

At the same time, the Independent Evaluation Group concluded that the inadequacy of internal controls regulating the Bank’s concessional lending rose to the level of a material weakness.

These problems will not be addressed by switching the seats around the table, nor will they be addressed by adopting the second of the commission’s recommendations: "Strengthening the WBG’s Reource Base," i.e. dumping more public money into the same pockets.  Greater taxpayer funding to finance the dubious actions of many of these people (and their friends, relatives, colleagues and cronies) sitting in brand new chairs is not the answer.

U.N. OIOS: Watchdog or Lapdog?

In honor of the 15^th anniversary of the United Nations Office of Internal Oversight Services (OIOS), the UN University hosted a panel today entitled “Watchdog or Lapdog? Maximizing the Value of Internal Oversight for a Better United Nations.” Cheers to the organizers for concocting this witty title; jeers to them for sugarcoating the topic.

Although the event – which included an opening address by UN Secretary-General Ban Ki-moon and a panel with Under-Secretary-General for Management Angela Kane (who has been accused of misconduct for publicly retaliating against a whistleblower) – seemed to present OIOS as an effective watchdog (albeit with room for improvement), GAP’s sources beg to differ. A preponderance of the evidence shows that the OIOS Investigations Division (OIOS/ID) – the unit that is supposed to investigate misconduct – is in many cases failing to do so and is also avoiding the implementation of much needed steps to improve its capacity to serve as an effective watchdog:

Exhibit #1: The Secretary-General stated during his opening remarks that the establishment of the UN’s Ethics Office was a significant accountability advance. What he failed to mention was that according to the Ethics Office’s August 2009 report to the General Assembly (para. 66), OIOS/ID failed to investigate a case of whistleblower retaliation referred to it by the Ethics Office, even though OIOS is tasked with conducting such investigations (para 5.5). Several whistleblowers have also approached GAP with complaints about OIOS’ failure to investigate their retaliation claims. How can OIOS expect witnesses to come forward with misconduct allegations when it refuses to protect them from retaliation for doing so? GAP submitted this question to the panel (via email) but the moderator failed to raise it, opting instead to end the panel 20 minutes early for a milk and cookie break. 

Exhibit #2: As alluded to by panel member Inga-Britt Ahlenius, Under-Secretary-General for Internal Oversight Services, OIOS/ID has been without a permanent director for more than two years, despite the nomination of qualified candidates, such as former head of the UN Procurement Task Force Robert Appleton. The fact that OIOS/ID lacks a permanent director who is protected from pressure and retaliation deprives the organization of a needed resource and deterrent to corruption, as pointed out in paragraph 22 of OIOS’ 2009 annual report. GAP also submitted a question regarding this situation, which the moderator once again failed to raise.

Exhibit #3: External reports have found that OIOS-ID is broken. A 2007 review by a UN consultant found that there appeared to be “something fundamentally awry with ID, its operating procedures and its underlying culture.” A separate assessment found similar problems and stated that: “the lack of effectiveness and high quality work of ID/OIOS is of critical importance because it affects the overall functioning of the Organization. First, it is detrimental to the Organization’s ability to manage and detect corruption, fraud and other serious offenses, which has in recent years damaged the reputation of the Organization and has engendered a sense of mistrust. Second, it impedes the ability of the Organization to combat and prevent future instances of wrongdoing.” OIOS has also come under fire from a former OIOS investigator who accused the office of whitewashing a report about wrongdoing committed by UN peacekeepers in the Congo.

Exhibit #4: As reported by the UN’s Independent Audit Advisory Committee, OIOS (especially OIOS/ID), has an extremely high vacancy rate, as more than 27 percent of its authorized posts are unfilled. Meanwhile, sources report that many OIOS/ID investigations into significant cases of fraud, such as one involving the misuse of USAID money by UN agencies in Afghanistan, are languishing. The rumor is that OIOS/ID is not conducting a single external investigation at the moment despite ongoing allegations of serious corruption. The General Assembly has requested that the Secretary-General fill these vacancies as a matter of priority. But instead of filling these positions, OIOS/ID is reportedly trying to reduce its mandate by claiming that it does not have the authority to investigate external contractors or former staff members accused of misconduct. But if they don’t, who will? 

Until OIOS/ID addresses these problems, it will be unable to effectively conduct its vital watchdog mission.

Obama and Nukes

President Obama will preside over a meeting of the United Nations (U.N.) Security Council today, where he is expected to call for a vote on a draft resolution that would halt production of weapons-grade plutonium and uranium and would strengthen the global Non-Proliferation Treaty. The President has secured support from China and Russia, important allies who had both hesitated to back the resolution.

With the resolution, the President will clearly contrast his policies with those of former President George W. Bush, who generally did not have confidence in arms treaties. However, it became clear during President Obama’s speech to the U.N. General Assembly yesterday that some Bush era policies will remain: particularly those regarding Iran’s nuclear aspirations and the Middle East peace process. Obama called for accountability on the behalf of Iran and North Korea if they continued to pursue nuclear weapons, but did say he would remain committed to pursuing diplomatic solutions first. The President also claimed to have re-engaged the United Nations, after many in the U.N. believed the former administration isolated itself from the rest of the assembly.

Critics of the nuclear resolution believe it will likely not be ratified quickly, nor will it be enforceable. Supporters believe that if the resolution, along with the Comprehensive Test Ban Treaty, which was defeated in the Senate in 1999, can be ratified now by the United States, other nations will quickly follow suit.

Whistleblower from the U.N.’s Weather Agency Receives Historic Compensation But is Not Reinstated

A whistleblower from the World Meteorological Organization (WMO) has been awarded nearly USD $500,000 by the International Labour Organization Administrative Tribunal (ILOAT), which found that she was harassed, defamed and wrongfully terminated for performing her auditing duties. This is believed to be one of the largest awards ever made by ILOAT in its 64-year existence.

The whistleblower, Maria do Rosario Veiga, was fired for refusing to cover-up her findings that USD $3.5 million was apparently embezzled by WMO officials. These funds were allegedly used, in part, in a cash-for-votes scandal that was used to rig the outcome of WMO’s chief executive election.

The decision is not all sunny skies. The Tribunal did not go far enough in making the whistleblower whole, as it refused to reinstate her. Also, none of the involved officials have been sanctioned or punished to date. And in a disturbing precedent, the decision states that the whistleblower’s copying of an e-mail to the U.S. State Department was misconduct and “would justify the decision not to renew the complainant’s contract.” (paragraph 75) This is a troubling finding, as the U.S. makes significant financial contributions to the WMO and other Intergovernmental Organizations and has historically played a crucial role in holding them accountable.  As Ms. Veiga’s attorney, Edward Flaherty, stated in a FoxNews story:  "Who is looking out for the U.S. taxpayer? It just reinforces the sad state of affairs of whistleblowers around the world, it doesn't matter if they work for a government, an international or multinational organization. Despite the great discussion of how whistleblowers should be encouraged and protected, the reality is that they end up suffering."

Ms. Veiga has vowed to continue fighting in national courts until the wrongdoers are disciplined.

Whistle Where You Work Episode 17 – World Bank Racism; FAA Ineptitude

In June, the Government Accountability Project released a report detailing widespread racial discrimination at the World Bank. This was followed, literally days later, by reports that racial slurs were posted inside the Bank walls, evidently by a staffer? What's going on here? We details why the Bank's internal justice system isn't equipt to properly handle racial discrimination cases, and how this system of allowing racism undermines the mission of the organization. Joining us are Bea Edwards of GAP and Wamara Mwine, reporter for the National Examiner.

Then, we sit down with former FAA Manager Gabe Bruno, who alleged that the FAA lacks a national security screening mechanism for certain mechanics that received fraudulent certificates from a Designated Mechanic Examiner (DME), but have refused to, or failed to fully complete, a recertification program. This failure creates a security vulnerability that leaves the aviation industry open to potential terrorist activity. For his disclosure, Bruno was harassed and forced into early retirement.

These segments were filmed in late July 2009, and March 2009, respectively.

You can view the episode here.

Creating Impediments for Whistleblowers at the UN

Some UN officials have proposed moving reporters to “open offices” where conversations with sources, including whistleblowers, can be more easily heard and seen, according to Inner City Press. Potential whistleblowers would be extremely discouraged to come forward without knowing their privacy and identity could be shielded. If this move were to occur, whistleblowers could be easily identified and retaliated against by the administration, which has a history of not supporting such employees. Whistleblowers must have a forum where they can expose corruption confidentially.

In other UN news, the international institution is still not commenting on its lack of giving back pay to whistleblowers who have won their suits for due process violations (also from Inner City Press’s article). No one from the UN Development Program or UN Ethics Officer Robert Benson (who had recommended paying the back pay to a UNDP whistleblower) has been talking about the situation. The UN is sending the message that whistleblowers who are awarded settlements are still not going to receive them. So is the UN really taking care of the situation at all?

World Bank Discrimination Needs More Attention

In additional coverage of GAP’s report on World Bank discrimination, one reporter from the Examiner asked White House Press Secretary Robert Gibbs about the report. But Gibbs stated that he hadn’t read the report, and denied comment.

As the White House neglects to consider this seemingly obvious discrimination, the situation isn’t getting any better. GAPs Bea Edwards notes that many private companies award bonuses, for example, to directors whose departments meet diversity targets. The World bank does not, and unfortunately, there’s no reason to expect it to do so anytime soon.