Satyam Computer Services, Inc. and the World Bank
Under FOIA, GAP has been working to oblige the US Department of Justice (DOJ) to produce documents related to the improper influence of a senior World Bank manager by a major Indian IT corporation. In 2008, a series of cyber-intrusions at the World Bank raised concerns about the security of international financial data held at the institution. The Bank’s chief vendor for cyber-security, Satyam Computer Services, Ltd. of India, came under scrutiny as the IT system the company had designed for the Bank appeared vulnerable. The facts that emerged about the scandal subsequently included a massive accounting fraud, an ineffective World Bank response to the emergency and persistent questions about the integrity of the Bank and its actions. Satyam, a billion-dollar IT outsourcing corporation, collapsed under the weight of the fraud in January 2009, and is now known as “India’s Enron.”
In December 2008, the World Bank admitted to GAP that Satyam had been suspended from consideration for future contracts by the Bank in February 2008, and debarred for eight years in September 2008. The debarment, Bank officials told GAP, was a penalty for giving improper benefits to staff members at the Bank and for the submission of undocumented invoices. The Bank claims that it informed the U.S. Justice Department of the fraud in 2006.
In November 2008 GAP filed a FOIA request with the Justice Department to learn what the Bank and U.S. government knew about corruption at the highest levels of Satyam management, and when they knew it. In December 2009, after three FOIA requests and two responses from the DOJ asserting that it had no information from the World Bank concerning corruption at Satyam, GAP received four documents in full and one in part from the Department. The remaining 13 documents were withheld in full. GAP is currently pursuing a lawsuit against the DOJ in which we contest the decision to withhold these documents. DOJ also failed to account for crucial documents that GAP asserts are in the possession of the Criminal Division. In addition, the DOJ consistently missed statuary deadlines in responding to our requests and appeals.
India and HIV
In 2008, GAP client Dr. Kunal Saha came forward with evidence that World Bank funds had been used for years to purchase defective test kits designed to detect the presence of HIV/AIDS in blood samples. The kits, which had been procured by the Indian government and distributed to hospitals and blood banks across the country, gave ‘false negative’ readings at an alarmingly high rate. As a consequence, HIV-contaminated blood would appear to be ‘clean’ and suitable for distribution.
After Dr. Saha reported these findings to the investigative unit at the World Bank, he faced a coordinated attempt to defame him and undermine his efforts to safeguard the Indian public. For example, the Bank and Indian government sought expert advice from a public health specialist at the Centers for Disease Control (CDC), a US government agency subject to FOIA. In December 2007, the Indian National AIDS Control Organization (NACO), working directly with the Bank, stated to the Indian press: “The documents cited by Dr. Saha have been reviewed by Dr. Robert Martin, associate Director, Coordinating Centre for Health and Information Services, Centres for Disease Control and Prevention, USA who is also of the view that there is no evidence of use of poor quality HIV test kits in India and his allegations have no basis.”
Dr. Martin did not consult Dr. Saha at any time before making this statement. The CDC (through its General Counsel) declined to identify to GAP, in the days after this statement was made, the evidence that Dr. Martin purportedly reviewed. The Bank presented Martin as an independent expert, but documents later showed that he was closely affiliated with NACO.
In 2008 GAP sought and obtained internal CDC documentation showing that the Bank’s contracted expert expressed concerns about the project similar to those voiced by our whistleblower. The documents show that Dr. Martin was reluctant to provide a statement criticizing Dr. Saha and didn’t believe that he had enough data to do so. Dr. Martin also writes that he didn’t “want to give the impression that NACO is addressing the purchase and validation of test kits in an appropriate manner – they are not and we both (Bharat and I) have had those discussions with NACO in the past.”
This communication reveals that Dr. Martin feared that substandard test kits were in use in India and that NACO was aware of this. It also shows that he did not wish to put anything in writing that would suggest otherwise, and he did not wish to criticize the whistleblower. Dr. Martin wrote this e-mail on November 30, 2007. One week later, Dr. Martin did put criticisms of Dr. Saha in writing to NACO, strongly suggesting that he was pressured to change his mind.
GAP believes that this subsequent correspondence was inappropriately withheld by the CDC, which withheld 45 pages that were supposedly “predecisional internal communications.” GAP appealed the CDC’s decision to withhold these documents, but unfortunately our appeal was unsuccessful.
Foundation for the Future
The Foundation for the Future (FFF) first became an issue of public interest inquiry in 2007, after GAP received the payroll records of Shaha Riza – the “girlfriend” of then World Bank President Paul Wolfowitz – from a whistleblower. These records showed that Riza, a British national who worked as a World Bank communications officer prior to Wolfowitz’s presidency, was seconded to the State Department after Wolfowitz arrived, where she received salary raises far in excess of increases that Bank rules allow. When detailed from the World Bank to the State Department, Ms. Riza – who was, at the time, earning substantially more than Secretary of State Condoleezza Rice – was charged with establishing the FFF, a nonprofit organization with a focus on grant-making in support of democracy and reform in the Broader Middle East and North Africa region. In October 2006, Ms. Riza was seconded to the FFF itself, where she remained until returning to the Bank in early 2008, after Wolfowitz was forced to resign for his role in improperly arranging her salary increases.
Because little information was publicly available about Riza’s activities at the Foundation for the Future, GAP filed a FOIA request with the Department of State in May 2007 for information regarding the Foundation. Over the course of nearly 34 months, the Department of State released 182 responsive documents in full and 85 in redacted form; 53 responsive documents were withheld in full. GAP has numerous concerns about the way in which the Department of State handled this request, including the Department’s: lengthy processing delays; withholding of responsive documents without listing them as withheld; retroactive classification of documents; inappropriate withholding of nonsegregable information; and overclassification of documents.
In July 2010, GAP released a report analyzing the documents that we obtained through this FOIA request. The report exposes the highly irregular manner in which the Foundation was established and operated by Bush administration officials and appointees. Specifically, the report details how high-level State Department officials misled Congress as they sought millions in public money for the Foundation, which was a haven for people with political connections. The report also shows that FFF was a pet project of Elizabeth Cheney, former Principal Deputy Assistant Secretary of State for Near Eastern Affairs.