World Bank bans Lahmeyer

The World Bank has banned Germany-based consulting engineer Lahmeyer International from Bank-financed contracts for seven years. The move follows findings of bribery on the Lesotho Highlands Water Project (LHWP). The ban may be reduced by four years if Lahmeyer puts anti-corruption policies in place and discloses past misconduct.

The World Bank’s Sanctions Committee found that Lahmeyer bribed LHWP’s Chief Executive, Masupha Sole, the government official responsible for contract awards on the scheme. The case is a re-opening of 2001 debarment proceedings against Lahmeyer in relation to the LHWP. The Government of Lesotho announced criminal indictments of Lahmeyer and Mr Sole in 1999.

Following the announcement of the indictments, the Bank’s Department of Institutional Integrity started an investigation into whether Lahmeyer had engaged in corrupt practices in relation to its contracts with the Bank. In October 2001, the Sanctions Committee found there was not sufficient evidence, but said it would re-examine its findings in light of any additional relevant information.

In 2002 and 2003, the High Court of Lesotho convicted Mr Sole and Lahmeyer of bribery. The Court of Appeal of Lesotho upheld Mr Sole’s conviction in April 2003, and Lahmeyer’s conviction on six of seven counts in April 2004. Following this the Bank re-opened debarment proceedings against Lahmeyer in August 2005.

In July 2004, the World Bank debarred Acres International, another company convicted of paying bribes under the LHWP, for three years.