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Protecting Whistleblowers since 1977

New Reports Contain Statistics Regarding Whistleblower Cases at the Multilateral Development Banks

Bea Edwards and Shelley Walden, December 17, 2012

In November, the U.S. Department of the Treasury issued two reports that contain information about the whistleblower protection records of the Multilateral Development Banks (MDBs).

In part, these reports are responsive to a spring 2012 GAP petition that urged the Department to include these data in its future reports.

The reports contain useful information about the implementation record at four MDBs. Key findings include:

The World Bank

According to one report, from January 2009 – July 2012 “233 staff and consultants made protected disclosures to INT [the Office of Institutional Integrity] of alleged misconduct.” During this time period, the Bank’s Office of Ethics and Business Conduct (EBC) received 26 whistleblower retaliation allegations. It appears that the EBC did not substantiate any of these allegations. The report also says that the final level of the Bank’s internal grievance system, the Administrative Tribunal, received 13 cases of alleged whistleblower retaliation during this time period and found in favor of six of the applicants.

GAP has several observations about these statistics. First, on the positive side:

  • Many staff members have made protected disclosures to INT without reprisal. This is, of course, the objective of the whistleblower protection policy.
  • Nearly half of the retaliation cases brought to the Tribunal were vindicated.

However, the figures also show that:

  • The EBC is not effectively protecting whistleblowers when retaliation does occur. Not one out of 26 retaliation complaints to the EBC was substantiated over a period of three years. While such a record is possible, it is highly improbable, especially in light of the fact that several whistleblowers who did not receive relief from EBC were apparently vindicated by the Tribunal.

Moreover, the report could be strengthened by showing whether the Tribunal substantiated the whistleblowers’ retaliation claims. Often, such cases involve not only allegations of retaliation, but also allegations of due process violations, and in GAP’s experience, the Tribunal has been hesitant to substantiate retaliation, even in cases in which it sided with the applicant on other claims. The statistic would also be more meaningful if it indicated whether the relief received by whistleblowers who prevail is comprehensive and covered the consequences of reprisal. Finally, the Treasury Department’s report implies that the Bank’s whistleblower policy is “consistent with international best practices.” 

The Inter-American Development Bank (IDB)

According to the same report, from 2009-2011 the Ethics Office received four requests for protection from retaliation and concluded that no retaliation existed in three of these cases.

The report mentions that the three cases were appealed to the Bank’s Administrative Tribunal. At the same time, it implies that the first case mentioned was not persuasive; according to the report it was “withdrawn by the staff member.” This is misleading. The Bank was obliged to resolve this matter to the constructive satisfaction of the complainant outside the judicial process.

The second case is still pending at the Tribunal, which is a problem in itself. The whistleblower reported retaliation in April 2010, and will not have a Tribunal hearing until 2013, if then. In the meantime, her career and her reputation have been severely damaged.

In the third case, the whistleblower won compensation in the amount of $300,000. Although the retaliation allegations were not substantiated in that judgment, a dissenting opinion by Judge Guilherme Caputo Bastos noted that the Bank violated its whistleblower protection policy and that “management did nothing to protect the whistleblower.”

There is also a retaliation case before the Tribunal that the report fails to mention.

Of the three cases the Ethics Office dismissed, then, one was settled by the Bank before reaching the Tribunal, and one received the maximum allowable compensation at the Tribunal. This record, while sparse, indicates the same problems as those at the World Bank: meritorious claims are not hospitably received at the Ethics Office.

The report mentions that in October 2012 the IDB passed a new whistleblower protection policy and highlights some of the improvements in the new rule. However, the report does not mention that, despite some advances, the policy is fundamentally flawed and fails to meet all best practice cornerstonesrequired by U.S. law. The report mentions that recommendations from Global Compliance “a firm the Bank engaged, at the urging of the United States, to conduct a comprehensive review of the Bank’s ethics, conduct, and grievance systems and to present recommendations for further policy development” were incorporated into the policy, but fails to mention that several key recommendations by Global Compliance were not included.

The African Development Bank (AfDB)

Since 2009, according to the same report, the AfDB has reportedly received seven whistleblower retaliation complaints. The AfDB reported that three of these whistleblowers were vindicated, one apparently by the Bank – which took pre-emptive action on the whistleblower’s behalf. GAP is encouraged to see that one MDB has apparently taken steps to protect a whistleblower, though this is clearly the exception to the rule.

Another AfDB whistleblower was vindicated through mediation and a final one through a court decision in a member country. Unfortunately, this latter avenue is not available to most MDB employees, due to the immunities that these organizations enjoy.

Asian Development Bank (ADB)

According to a separate report on the Asian Development Bank, from 2007-2011 the Bank’s Office of Anticorruption and Integrity (OAI) received “on average, about 200 registered complaints each year.” The Bank reported that it received five requests for whistleblower protection during this time period, but that “retaliation was not at issue in any of these matters.”


These reports were issued because U.S. law states that the U.S. contribution to the General Capital Increases (GCI) for the IDB, World Bank and AfDB may not be disbursed until the Secretary of the Treasury reports to Congress that the respective MDB is “making substantial progress” toward “implementing best practices for the protection of whistleblowers from retaliation...” (A similar requirement exists for the Asian Development Bank, but in a separate law). While GAP applauds the Treasury Department for releasing additional information about each Bank’s implementation record, we are concerned that the Department has not done enough to substantiate the record of each institution, particularly the IDB, which appears to have provided somewhat misleading information.

 

Shelley Walden is International Officer for the Government Accountability Project, the nation's leading whistleblower protection and advocacy organization.

Bea Edwards is Executive and International Director for GAP.