Taking corruption seriously

The Canadian engineering company Acres International of Ontario has been found guilty of paying bribes for contracts on the multibillion rand Lesotho Highlands Water Project dams, a judgement which could have profound implications for Third World development projects.

Acres, which is due to be sentenced next month, maintains its innocence and is to appeal against the Lesotho High Court judgement.

Other multinational construction companies involved in the project in the tiny Southern African mountain kingdom are due to be tried and, if convicted, could be blacklisted by the World Bank and other international bodies. They include Sir Alexander Gibb, a British engineering consultancy that is now part of the United States group Jacobs, and the French company Spies Batignolles, which led a consortium of companies.

On Tuesday Chief Justice Mahapela Lehohla found Acres guilty of paying about $260 000 in bribes to Masupha Sole, a former chief executive of the project, through its local agent.

In May Sole was jailed for 18 years for corruptly accepting more than $3-million in the 10 years from 1988.

An Acres spokesperson said on Wednesday that the company was shocked by the judgement. He said the company was unaware that part of the money it paid to its agent was being secretly transferred to Sole’s Swiss bank accounts.

“Acres is proud of its efforts to assist in developing countries around the world and it is also proud of its 78-year unblemished record for ethical business practice and its high reputation for integrity and honesty in international development,’’ he said.

Earlier this year a World Bank internal investigation exonerated Acres and Gibb.
It said it would examine the judgement and the trial transcript before taking any further decisions. Its policy is to debar any company found guilty of corruption on bank- financed projects.

Acres is employed on two other controversial dams funded by the bank: the Bujagali dam in Uganda and the Nam Theun 2 dam in Laos.

Ryan Hoover of the International Rivers Network in California, which campaigns for human rights and environmental protection, said: “The Acres verdict throws into doubt the legitimacy of their involvement in other dam projects throughout the world. Anything less than disbarment would undermine not only the World Bank’s own corruption policy but also its poverty-alleviation objectives.’‘

The Canadian group Probe International also welcomed the judgement. Executive director Patricia Adams said: “Lesotho has shown that it takes corruption seriously by convicting its own corrupt officials as well as the corrupt briber.

“If Western governments get tough with convicted bribers, multinational firms will get the message that corruption is costly, and that will spell the end of corruption on Third World development projects. If Western governments don’t get tough, we in the West will be seen as hypocrites who preach clean government to the Third World while tolerating corruption among our own corporations.”

The Lesotho scheme is the biggest civil engineering project in Africa, intended to dam five sections of the Senqu river. One dam has been completed and a second is under construction.—(c) Guardian Newspapers 2002

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