Satyam scam betrays gaps in UN system

The Satyam scandal seems to have revealed a huge gap in the sprawling UN system, with some of its affiliates squarely blaming the World Bank for not sharing action taken against the IT firm.

The Satyam scandal seems to have revealed a huge gap in the sprawling United Nations system, with some of its affiliates squarely blaming the World Bank for not sharing action taken against the IT firm that continued to get business from the global body.

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Satyam still has about a dozen technical consultants working in the UN.

The World Bank, on its part, says that it kept the suspension under wraps to avoid damaging the reputation of Satyam as it was not banned until September 2008, and therefore cannot be found fault with for not informing UN, which awarded a contract to the Indian company in June last.

In the meantime, the UN agencies say their review of vendors barred by World Bank never turned up the Satyam name, until the international lender upgraded the temporary suspension to a formal ban.

The World Bank temporarily suspended Satyam in February 2008, but converted it into a formal ban only late in September, and this too was made public only in December.

Asked why it did not inform about issues with Satyam to the UN, which awarded a six million dollar contract to the Indian company in June 2008, a World Bank spokesperson told PTI in an e-mailed statement: "To inform others during the suspension period could potentially damage a company's reputation, and business, before they have been given an opportunity to present evidence that may be exculpatory.

"The World Bank temporarily suspended Satyam in February 2008. The firm was not debarred until September 2008 well after the UN contract, which was awarded in June 2008."

World Bank is an independent specialised agency of the UN and serves as a member and observer in many UN bodies.