World Bank Blacklists Scottish Firm for Fraud
The World Bank has blacklisted an anonymously-owned Scottish company for engaging in “fraudulent practices” to win deals under an emergency medical aid programme in Uzbekistan.
NovoLine Resources L.P., registered in Edinburgh, was found
to have used fake documents to win World Bank-funded tenders to supply
Uzbekistan’s health ministry with medical supplies, including anesthesia and
respiratory equipment.
The World Bank issued a notice in November recommending that
NovoLine Resources L.P. “be declared ineligible to be awarded or otherwise
benefit from a Bank-financed contract, financially or in any other manner.”
This came after accusations that it had, “in an attempt to
mislead the relevant procurement authority, in order to obtain the award of the
contract,” submitted a set of false financial statements and a false past
equipment sales contract.
As a result, NovoLine has been banned from bidding in the
World bank’s procurement processes for at least three and a half years.
A Scottish MP has called the reports “unsurprising,”
according to Open Democracy.
“By continuing to turn a blind eye, the U.K. government is
essentially complicit in facilitating this type of activity,” Glasgow Central
MP Alison Thewliss reportedly said. “It has to get a grip on this problem and
fast, if it cares at all about the U.K.’s reputation as an honest place to do
business.”
This isn’t the first time an anonymous company registered in
Scotland has been caught up in fraud in Uzbekistan. In 2018, the United Nations
barred four anonymously owned Scottish firms from bidding for their contracts
after they were found to have engaged in “fraud and collusion”.
The ultimate beneficial owners of these companies, like
NovoLine, remain unknown, but experts say it’s more likely that they lie in
Uzbekistan rather than the U.K.
“U.K. legal entities are a key feature of the corruption
landscape in Uzbekistan,” Kristian Lasslett, professor of Criminology at Ulster
University in Northern Ireland told Open Democracy. “They are used to conceal
the identity of politically exposed persons, launder money, facilitate bribe
payments, organise frauds, and access the global financial system.”
Uzbekistan ranks as the third most corrupt country in
Eastern Europe and Central Asia on Transparency International’s 2020 Corruption
Perception Index, and in the bottom 40 worldwide, ranking 146th out of 180
countries.
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