Company debarred for leading a corrupt and collusive scheme, and obstructing INT’s investigation
WASHINGTON, July 5, 2016—The World Bank Group announced the debarment of the Ukrainian company “Information Computer Systems CJSC” (Incom) for 22.5 years in addition to the three-year debarment given to Incom in 2014 in a related case.
An investigation by the World Bank Integrity Vice Presidency (INT) revealed that Incom paid bribes and engaged in collusive and corrupt behavior in relation to the award of three IT contracts worth approximately US$43 million under the Social Assistance System Modernization Project in Ukraine. Furthermore, Incom was also debarred for multiple attempts at obstructing the World Bank investigation.
“This case presented us with unique and complex challenges. The decision by the Sanctions Board represents a huge victory to the efforts of the World Bank Group in safeguarding its projects from manipulative and corrupt behavior by some companies,” said Leonard McCarthy, World Bank Integrity Vice President. “The company’s unsuccessful attempts to obstruct the World Bank investigation is evidence that corruption will ultimately be exposed and the consequences are severe. This is the largest debarment handed down by the Sanctions Board outside indefinite debarment and reflects not only the company’s wrongdoing but also its conduct during the investigation and litigation processes.”
The World Bank’s investigation and litigation of the case was conducted in multiple phases to protect the Bank’s funds and minimize impact on project progress. The first phase of the litigation focused on Incom’s engagement in fraudulent activity which resulted in its debarment for three years in 2014. This sanction announcement is the outcome of the second phase of the litigation.
In addition to debarring the company, senior officials of Incom were also debarred: Mr. Alexander Fedchenko – President of Incom, for a minimum period of 11.5 years, Mr. Nikolay Dovzhenko – Vice-President of Incom, for a minimum period of 8.5 years. The Sanctions Board also debarred one of the other two companies involved in the collusive scheme in this decision. BMS Consulting LLC was debarred for a minimum period of 6 years, along with its Chairman, Mr. Sergei Savchenko, who was debarred for a minimum period of 5.5 years. The other company involved in the scheme, Roma LLC, was debarred in 2015 for 7 years. Any entity directly or indirectly controlled by these companies and individuals is also sanctioned and cannot engage in any World Bank Group-financed project throughout the debarment period.
The debarment of these entities and individuals qualifies for cross-debarment by other MDBs under the Agreement of Mutual Recognition of Debarments that was signed on April 9, 2010.