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CDC HIV/AIDS/Viral Hepatitis/STD/TB Prevention News Update
INDIA: World Bank Probe Finds Fraud

January 14, 2008
Wall Street Journal (01.14.2008) - Friday, January 14, 2008

On Friday, the World Bank announced that an internal review launched in 2006 has uncovered "serious incidents of fraud and corruption" in five health projects it has funded in India. The projects, which total $570 million, include efforts to slow HIV/AIDS, tuberculosis and malaria, the bank said.

"The probe has revealed unacceptable indicators of fraud and corruption. The government of India and the World Bank are committed to getting to the bottom of how these problems occurred" said bank President Robert Zoellick.

The internal review follows a 2005 investigation that uncovered corruption by two Indian drug companies involved in a bank-backed child- and reproductive- health project in the country. Those findings led Paul Wolfowitz, then the bank's president, to suspend health loans to India until it addressed concerns about procurement procedures.

Zoellick did not indicate that the current report's findings would prompt him to make a similar move. But he did say that outside reviewers will examine the bank's own anticorruption efforts and that the World Bank will address staff failures in project design, supervision, and evaluation.

It is not yet clear whether the wrongdoing involves staff at the bank, Indian government officials or other parties, such as companies contracted to supply drugs or other materials for the projects.