• Skip to main content
  • Skip to after header navigation
  • Skip to site footer

Guide to Combating Corruption & Fraud in Infrastructure Development Projects

  • Detection
    • Complaints
      • General initial interview questions
      • How to Generate Complaints and Reports
      • List of fraud reporting sites for Multilateral Development Banks
    • Red Flags
      • Red Flags Listed by Project Cycle
      • “Visible red flags” of Implementation Fraud
      • Proactive Fraud Detection Tests
    • Due Diligence
      • “Top Five” Due Diligence Background Checks
      • Free and Subscription Internet Sites
      • Local and On-Site Due Diligence Checks
      • Due Diligence Service Providers
  • Proof
    • Proving Common Schemes
      • Corruption Schemes
      • Bid Rigging Schemes
      • Collusive Bidding Schemes
      • Fraud Schemes
      • The Basic Steps of a Complex Fraud and Corruption Investigation
    • Elements of Proof for Sanctionable Offenses
      • Elements of Proof of Corrupt Practices
      • Elements of Proof of Obstructive Practices
      • Elements of Proof of Coercive Practices
      • Elements of Proof of Collusive Practices
      • Elements of Proof of Fraudulent Practices
  • Evidence
    • The Basics of Evidence for Investigators
  • Prevention
    • Anti-fraud Resources
Home » Proof » Case Examples » Case Examples of Hidden Interests

Case Examples of Hidden Interests

West Africa, Road Project

The Director of a road rehabilitation project instructed an international firm competing for the construction supervision contract to include a certain local subcontractor in its proposal, and to allocate 10% of its bid price to it. The subcontractor was to provide labor to assist in land surveys. The project official assured the international firm that it would win the contract if it agreed to use the specified contractor.

The international firm complied, won the contract, and was only mildly surprised to discover that the local subcontractor was owned by the Project Director. It was more disturbed, however, to learn that the sub-contractor’s employees, for which they were paying exorbitant fees, were fulltime project staff.  The subcontractor provided no actual services and the employees received only their project salaries.

Central Asia, Various Projects

Similarly to the West African case above, in at least two cases in Central Asia, local project and government officials set up side companies that “employed” (without paying) the salaried staff they supervised. The officials then recommended or insisted that international firms hire the companies as subcontractors for 10% of the contract value.

In other cases in the region local project staff purchased project vehicles, computers and office equipment through front companies they controlled and resold them to the project at several times their actual value. In one case, the project officials purchased printers for their retail price of US$400 and resold them to the project for US$8,000.  In another case the officials delivered used and inoperable computers and vehicles.

Category: Case Examples

International Anti-Corruption
Resource Center

Washington, DC
info@iacrc.org

IACRC - International Anti-Corruption Resource Center

© 2025 · IACRC · Guide to Combating Corruption & Fraud in Infrastructure Development Projects · All Rights Reserved