Hindsight is always 20/20. As we inaugurate the Padma Multipurpose Bridge in Bangladesh, it is a good time to reflect on the World Bank's shocking decision taken almost exactly ten years ago, on 29 June 2012, to cancel the funding for the Padma Bridge Project.
Not only is it easier to analyse and evaluate the situation now, but certain revelations over the last decade have uncovered some startling facts surrounding the Padma Bridge.
A strange coincidence
We now know that the decision to cancel the World Bank's loan agreement for the Padma Bridge coincided precisely with the last day of the then President, Robert Zoellick. The loan was cancelled on the same day as Zoellick, the United States' nominee to the World Bank, retired.
The Bank has defended this coincidence by stating that all of its decisions were taken by the institution and not an individual. The fact remains, however, that the loan cancellation was initiated by the World Bank's Integrity Vice Presidency (INT), which is an independent unit within the World Bank Group responsible for investigating allegations of corruption in relation to projects financed by the World Bank.
The INT reports directly to the president and it was the INT that had initially received a series of emails from tipsters claiming that there was corruption in the process for awarding a $50 million construction supervision contract to a Canadian company, SNC-Lavalin.
The INT later shared these emails, its own investigative reports, and other documents with the Royal Canadian Mounted Police (RCMP).
The evaluation processes
The World Bank was a primary lender in relation to the Padma Bridge project, which had to comply with all its procurement guidelines. The World Bank had ensured that clear and strong justification were provided on why each firm was qualified to bid or lacked the necessary qualifications.
For instance, the Bangladesh Bridge Authority had excluded the China Railway Construction Corporation from the pre-qualification list without providing adequate justification.
In accordance with its procurement guidelines, the World Bank asked for complete information, which entailed several requests for clarification.
Only after all the required information was provided, did the World Bank accept the government's proposed pre-qualification list and agreed with the decision of the government to exclude the firm.
As part of the competitive evaluation process, five companies were short-listed for the supervision work: AECOM, HPR, Halcrow, Oriental and SNC-Lavalin. The technical qualifications of the bidders were evaluated by a committee and the ranking of the bidders was released on 19 December 2010. That ranking placed HPR first, SNC-Lavalin second, AECOM third, Halcrow fourth, and Oriental fifth.
The second stage involved consideration of the financial aspects of the proposals. Those considerations lead to a re-ranking of the bidders, which was released on 28 March 2011. That ranking resulted in HPR no longer being in the first place.
Instead, Halcrow was first, followed by SNC-Lavalin, then HPR, AECOM and Oriental. Thus, considering both the technical and financial qualifications, SNC-Lavalin was deemed to be the most competent bidder.
This work was done under the supervision of the World Bank and no complaints were raised while the process was going on. No justification has since been provided as to why the most qualified bidder who was chosen for the work under the Work Bank procurement guidelines would have to engage in a conspiracy for corruption for the work.
Emails from four (or two) tipsters
After the bid process was completed and the work was awarded to SNC-Lavalin, anonymous tipsters apparently sent emails to the World Bank alleging a corruption conspiracy.
World Bank's INT later shared the tipsters' emails, its own investigative reports, and other documents with the Royal Canadian Mounted Police (RCMP). In particular, an investigator within the INT began providing information to the RCMP that the World Bank had received information from four tipsters through emails.
At the time of cancellation of the Padma Bridge Project, the World Bank stated that it had credible evidence corroborated by a variety of sources, which points to a high-level corruption conspiracy among Bangladeshi government officials, SNC-Lavalin executives, and private individuals in connection with the Padma Multipurpose Bridge Project.
It further noted that in Canada, where SNC-Lavalin's headquarters are located, after executing numerous search warrants and a year-long investigation based on a referral from the World Bank, the Crown Prosecution Services brought corruption charges against two former SNC executives in connection with the Padma Bridge Project. Investigation and prosecution are ongoing, but the court filings to date underscore the gravity of this case.
The RCMP investigation commenced in April 2011. The RCMP applied for and was granted a court authorization for wiretaps, i.e. to intercept private communications. During its investigation, the RCMP did not know the identity of either Tipster 1 or Tipster 3.
Regarding Tipster 1, the relevant Canadian court eventually even doubted whether he/she was the same person as Tipster 2 and/or Tipster 3. There was no avenue to distinguish them as different persons, let alone know their identities.
The court pointed out that because the RCMP never checked out the tipsters, it is unclear if there were ever four informants providing information, or simply two individuals using different email accounts.
Regarding Tipster 2, the Court found that while the World Bank knew his identity, the Canadian Police did not actually investigate his background to determine his credibility or reliability.
In fact, it turned out that he was a disgruntled competing bidder, who had been previously involved in corruption and was also engaged in corrupt practices. Thus, it was a clear case of an unreliable source providing unreliable information.
No RCMP officers actually met with Tipster 2 but only spoke to someone by telephone. Regarding the information provided by these tipsters, the Ontario Superior Court of Canada concluded that most, if not all, the information had, in turn, been received by the tipsters from other sources, i.e. they were all hearsay evidence.
No one had any direct knowledge of any corruption. It is a general rule of evidence law that hearsay evidence is generally inadmissible given its inherent unreliability. The court concluded that "the suggestion of corruption is based on rumours".
The information from Tipster 4 was found to be very general in nature and was essentially irrelevant to the allegations that SNC-Lavalin was involved in corrupt practices.
The court concluded, "Nothing that could fairly be referred to as direct factual evidence, to support the rumour and speculation, was provided or investigated. The information provided by the tipsters was hearsay (or worse) added to other hearsay."
The Fictitious Dubai Trip for the "Deal"
The Canadian court was thus especially critical of the RCMP's claims that there was evidence of some people possibly travelling to a meeting in Dubai to discuss their bribery plans in person.
The RCMP relied on the travel history of the accused persons to try to confirm the information from a tipster who said "the deal" was concluded at a meeting in Dubai. The tipster had said that Mr Wallace would "definitely be" at the meeting.
However, eventually when the RCMP tried to obtain the travel history from the Canada Border Services Agency, it was discovered that Wallace had not been in Dubai at any point in time.
The absence of 3Cs
Kevin Wallace, former vice-president of energy and infrastructure, his subordinate Ramesh Shah, former VP of the international division, and Zulfiquar Ali Bhuiyan, a dual Bangladeshi-Canadian citizen, all pleaded not guilty to bribing foreign officials in order to secure a construction contract in Bangladesh.
Just before they entered their pleas, federal Crown attorney Tanit Gilliam told Superior Court Justice Ian Nordheimer that she would not be calling any evidence and would ask that the judge acquit the men. She admitted that without the wiretap evidence, the Crown no longer had a reasonable prospect of conviction.
The Court held: "Reduced to its essentials, the information provided in the ITO (Information To Obtain) was nothing more than speculation, gossip and rumour," Nordheimer wrote. "Nothing that could fairly be referred to as direct factual evidence, to support the rumour and speculation, was provided or investigated.
"While I may not be prepared to go so far as to find that the RCMP did not proceed in good faith in this case, there are aspects of the ITO that are troubling."
For wiretap evidence to be admitted, all information provided by the informant must be compelling, credible and corroborated (the 3 Cs). The term "compelling" refers to considerations that relate to the reliability of the informer's tip such as the degree of detail provided and the informer's means of knowledge, that is, whether the informer made first-hand observations or merely relied on second-hand hearsay, rumour, or gossip.
The term "credibility" would appear to capture considerations such as the informer's motivation, criminal antecedents, and any past history of providing reliable information to the police. The term "corroboration" refers to any supporting information uncovered by the police investigation.
In the case before the Canadian court, all of the evidence was excluded as they were not compelling, credible, or corroborated. The case therefore collapsed. The Canadian court judgement was clearly at odds with the World Bank's claims in June 2012 that it had "credible evidence" of high-level corruption among Bangladeshi government officials.
Who will watch the sheriff?
The Padma Bridge fiasco serves as an important lesson for the World Bank. Instead of doing the proper investigative groundwork, the World Bank took the flimsiest of evidence as a basis for using the "nuclear weapon" of cancelling a project.
It is heartening that since the cancellation of the Padma Bridge Project, the World Bank, as an institution, has reassessed its policy. The World Bank's Country Assistance Strategy Progress Report has since shifted its policy to state that "When evidence of corruption comes to light, its response should not be to disengage, but to engage differently."
The World Bank admitted that decisions to disengage have affected its relationship with clients, resulted in losses of knowledge and momentum and left important development objectives unaddressed.
The World Bank found that any disengagement carries a cost. For example, the Bank committed $4.6 billion for Bangladesh for three fiscal years from 2010 through to 2013, but it achieved only 87 percent of the planned projects.
What is more troubling is the recent allegations that have surfaced against the World Bank's hired gun, Luis Moreno-Ocampo, former Chief Prosecutor at the International Criminal Court (ICC), who led the review of Bangladesh's investigation of alleged corruption tied to the Padma Bridge Project.
In October 2017 European Investigative Collaboration (EIC) – a network of investigative journalists – published reports that were embarrassing to the International Criminal Court (ICC) and Moreno-Ocampo.
It was reported that soon after leaving the ICC, Moreno-Ocampo returned to being a lawyer to use his expertise and his contacts to help some clients who were his former targets at the ICC.
According to reports, he worked to find an "honourable" way out for Kenyan President Uhuru Kenyatta, whom Ocampo himself had indicted for crimes against humanity.
It was further reported that Luis Moreno-Ocampo had offshore bank accounts in Panama and the British Virgin Islands, while he had been a top representative in the Latin American chapter of Transparency International, an organisation that fights against tax evasion and tax havens.
Looking back, it is legitimate to ask the World Bank what prompted it to carry out the witch-hunt, through prosecutors with questionable characters, that eventually led to the cancellation of the Padma Bridge Project based on so-called evidence which was not credible, compelling, or corroborated.
Moin Ghani is a Barrister and an Advocate of the Supreme Court of Bangladesh.
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.