Pakistan

Global Partnership for Education –
    Balochistan Education Project

            Redacted Report




                          March 2020
                                Statement of Use and Limitations

This Report was prepared by the World Bank Group (the “WBG”) Integrity Vice Presidency
(“INT”). It provides the findings of an INT administrative inquiry (the “Investigation”) into
allegations of corrupt, fraudulent, collusive, and/or coercive practices, as defined by the WBG for
purposes of its own policies, rules and procedures (the “WBG’s Framework regarding Anti-
corruption”), in relation to the WBG-supported activities. The purpose of the Investigation was to
allow the WBG to determine if the WBG’s Framework regarding Anti-corruption has been
violated.

This Report is being shared to ensure that its recipients are aware of the results of the INT
Investigation. However, in view of the specific and limited purpose of the Investigation underlying
this Report, this Report should not be used as the sole basis for initiating any administrative,
criminal, or civil proceedings. Moreover, this Report should not be cited or otherwise referred to
in the course of any investigation, in any investigation reports, or in any administrative, civil, or
criminal proceedings.

This Report is provided without prejudice to the privileges and immunities conferred on the
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subsequent judicial, administrative or other proceeding pursued in connection with this matter.
The WBG’s privileges and immunities cannot be waived without the prior express written
authorization of the WBG.




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Background

In March 2015, the International Bank for Reconstruction and Development and the International
Development Association (collectively, the “World Bank”), acting as Administrator for a Trust
Fund, signed a Grant Agreement with the Islamic Republic of Pakistan (“Pakistan”) for the Global
Partnership for Education – Balochistan Education Project (the “Project”). The Project became
effective in March 2015 and closed in December 2018.

The Project sought to: (i) to increase school enrollment and retention in Project-supported schools,
with a special focus on girls’ participation, and (ii) to develop mechanisms for information
collection and use for improved management of education. The Province of Balochistan was the
Project’s responsible implementing agency.

The government entity responsible for the Project within the Province of Balochistan (the
“Employer”), published an Invitation to Bid for a Project-financed Contract (the “Contract”).
Company A, represented by an individual (the “Representative”), bid for and was awarded the
approximately US$ 300,000 Contract.

Allegations & Methodology

The Employer’s Project Management Unit (“PMU”) reported to the World Bank’s Integrity Vice
Presidency (“INT”) that Company A had potentially engaged in fraud during Contract
implementation.

INT conducted a review of relevant procurement and Project documents, obtained further
clarifications from the PMU, and independently obtained further evidence.

Findings

       Evidence indicates that the Representative, acting on behalf of Company A, submitted
       falsified Performance and Advance Payment Guarantees.

As winning bidder for the Contract, Company A was required to submit Performance and Advance
Payment Guarantees to the Employer. Evidence indicates that the Representative, acting on behalf
of Company A, submitted a Performance Bank Guarantee and an Advance Payment Guarantee,
each purportedly issued by a commercial bank (the “Commercial Bank”).

However, evidence indicates that Company A’s guarantees were falsified. The PMU sought
verification of Company A’s guarantees from the Commercial Bank. The Commercial Bank
denied having issued Company A’s guarantees.

Subsequently, the PMU met with the Representative regarding the authenticity of Company A’s
Performance and Advance Payment Guarantees. The Representative did not provide evidence or
a satisfactory explanation to refute the PMU’s findings.




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Corrective Actions

After the PMU’s meeting with the Representative, it cancelled the Contract award to Company A
and awarded the Contract to the next lowest responsive bidder.

The World Bank imposed the administrative sanction of debarment with conditional release on
Company A and the Representative. These sanctions extend to any entity that the Representative
or Company A directly or indirectly control.




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