World Bank disqualifies Spanish construction giant FCC for 'fraudulent practices' in Colombia
The World Bank (WB) announced on Wednesday the disqualification of the Spanish construction company FCC for two years for "fraudulent and collusive practices" in two tenders for an environmental project in Colombia, to whose government it must pay 5.5 million dollars.
The decision, resulting from a conciliation agreement with the company, disqualifies FCC Construcción SA from participating in projects and operations financed by the institutions of the World Bank Group for two years, the bank said in a statement.
The company must pay "a restitution" in the amount of 5.5 million dollars to the Colombian authorities.
According to the World Bank, this agreement could mean the disqualification of FCC from participating in projects of other multilateral development banks by virtue of an agreement signed between them in 2010.
Through the agreement, the construction company does not contest the guilt of the underlying punishable practices, which occurred under a previous shareholding structure and undertakes to comply with certain corporate conditions as a condition for the release of the disqualification, said the World Bank statement.
The measure responds to FCC's participation in the tender for the Project for the Hydraulic Adaptation and Environmental Recovery of the Bogotá River, designed by the Government of Colombia to make this river an 'environmental asset' for the metropolitan area of the capital, improving quality of water and reducing the danger of flooding.
According to the WB, FCC participated in the bidding of two contracts that it financed, in one of which it agreed with public officials, through a subcontractor and a commercial agent, to disqualify a competitor, which is a collusive practice.
Also, FCC misrepresented the use of the contract advance, which is a fraudulent practice, the agency said.
The statement also added that FCC knowingly misrepresented the composition and roles of three companies within a consortium that would execute the contract, which is a fraudulent practice, despite which, the contract fell to a competing consortium.
The World Bank assured that the agreed reduced sanction period of two years responds to the extraordinary cooperation and voluntary corrective actions taken by the company under a new shareholding structure.
This included sanctioning those responsible, an internal investigation and the voluntary restriction of participating in projects financed by the World Bank during the negotiation of the agreement.
The Spanish construction company has also committed to following an integrity compliance program according to the principles established in the WB's integrity compliance guidelines.
The company must pay "a restitution" in the amount of 5.5 million dollars to the Colombian authorities.
According to the World Bank, this agreement could mean the disqualification of FCC from participating in projects of other multilateral development banks by virtue of an agreement signed between them in 2010.
Through the agreement, the construction company does not contest the guilt of the underlying punishable practices, which occurred under a previous shareholding structure and undertakes to comply with certain corporate conditions as a condition for the release of the disqualification, said the World Bank statement.
The measure responds to FCC's participation in the tender for the Project for the Hydraulic Adaptation and Environmental Recovery of the Bogotá River, designed by the Government of Colombia to make this river an 'environmental asset' for the metropolitan area of the capital, improving quality of water and reducing the danger of flooding.
According to the WB, FCC participated in the bidding of two contracts that it financed, in one of which it agreed with public officials, through a subcontractor and a commercial agent, to disqualify a competitor, which is a collusive practice.
Also, FCC misrepresented the use of the contract advance, which is a fraudulent practice, the agency said.
The statement also added that FCC knowingly misrepresented the composition and roles of three companies within a consortium that would execute the contract, which is a fraudulent practice, despite which, the contract fell to a competing consortium.
The World Bank assured that the agreed reduced sanction period of two years responds to the extraordinary cooperation and voluntary corrective actions taken by the company under a new shareholding structure.
This included sanctioning those responsible, an internal investigation and the voluntary restriction of participating in projects financed by the World Bank during the negotiation of the agreement.
The Spanish construction company has also committed to following an integrity compliance program according to the principles established in the WB's integrity compliance guidelines.