·-+ ·- ~-:-·

+
|-=-
Spotting
Everyday
Red Flags Red Flags
Workshop
+=·=+ =·-·
components
I t d ti t I t it
-

„ Introduction to Integrity
„ ADB’s Anticorruption
ƒ :=-··-+ |·==
º:¤+ ~==· -·( --
„ ADB s Anticorruption
Policy, Guidelines and
Process
ƒ º:¤+ ~==· -·( --
-··+ -¤ |+=
„ Conducting Basic Due
Diligence
ƒ =(·~- =¤=- |·¬=+
===-
„ Spotting Every Day Red
Flags
ƒ ·-+ ·- ~-:-·+
Flags
|-=-
Definition –
|·~ — ·- ~-:
Red Flag
|·~ ·- ~ :
„ A warning signal „ =---+ =+-
„ something that
serves as a
„ ==·- ==-= - ¤-·+
¤· =--- =-- -·c serves as a
warning of
trouble or
¤· =--- =-- -·c
trouble or
danger ahead
Irregularities in
==|+ ==-=
contact information
=-==--
„ Incomplete information
„ PO Boxes
„ Telephone number in
„ =|· ==-
„ |= ¤+=-·
„ Telephone number in
one country, address in
another country
N t d d
„ | = ¤+=-·
„ º+ ··+ ==|- -=¤·. =+
··+ s=-
„ Non-standard
information
example:
··+ s=-
„ =|·-: |-+= ==-
p
xxx@adb.com
=·-·- –
xxx@adb.com
R d Fl Red Flags ·- ~-:-·
„ Help to identify potential
risks
„ ==~-- =¤=-· -=-
=- =-== =·c
„ Require additional due
„ =-·a =¤=- |·¬=
diligence
=-·=+ |·c
„ May not be a problem if
explained through
i d d t d
„ ---·+ =¤=- |·¬=¤=
·=r= ~º ==-= ---
independent due
diligence
=+·c
Same contact
information for two
·: +=|-+ º+ ==|+
information for two
companies
==-
Firm A Firm B
T (xxx) 720-5096 ( ) 0 5096
T (xxx) 739-3827 T (xxx) 739-3827
F (xxx) 724-5061 F (yyyy) 111-2058 F (xxx) 724 5061 F (yyyy) 111 2058
O l bil

Or only a mobile
telephone number
t d
- =¤:= -=¤· =+
=|=·( =·:º+
presented
Inability to contact a
+=|-=: ==|+ =-
company
-=+-
„ Through presented
telephone/fax number
„ =|=·( =·:º+
==|-/ˆ=+==|-
„ By e-mail
„ By DHL or Mail
==|-/ˆ=+==|-
„ :===|-

PO Boxes may be a
„ :º=º= - -=+=|-

red flag, as it may
indicate that a firm is
t l t d t th t
+=|- =a s=-= c- ~·- =+-
=·· |= ¤+=-· ·- ~-:
--=+·c
not located at that
address.
--=+·c
I b bl dd
+===+ -¤- - s=- =··-|- c
Improbable address
Check address and
s=- -¤ ==|+ --·--·
contact details on the
internet (e.g. Google
Earth)!
s=- -¤ = |+ --· -·
:·=·-== == =- =·-·-
=== =¤
Earth)!
Internet presence
:·=·-== =|-¤-
Internet presence
N i
: =·-== =|-¤-
„ No internet presence
(especially for IT company)
„ Only basic internet
„ :·=·-== =|-¤- c- -·
=·· =:= +=|-+ ==
presence
„ Can’t click through links
„ No identification on site,
„ =(·~- :·=·-= =|-¤- =+
„ =:-·=|- +=+ =- -=+-

including
„ Directors
„ Address
„ -¤=:== +- =-- |-=-
=-=¤ c-
„ -··+-·
„ Specific contact
information
„ Unusual characteristics on
„ s=-
„ -·= ==|+ ==-
„ Unusual characteristics on
website
„ -¤=:== ==(·- -·--·
|··- =·c
Refusal, delay in +==--· =|=·( =·=- Refusal, delay in
providing documents
+==--· =|= ( =·=-
==-=-. t==--
„ Including
Registration
„ ===-
„·- ==¤·(
„ Registration
documents
„ Passport
+==--·
„|=|=
p
information
„ Other credentials
„==-
„=·= =(·-·
Use of corporate
t i
+=|- ==--·+ |==
secretaries
„ Significant involvement
of corporate secretary
i i i
„ ==·= +=|- ==-+
=-= =-~=-.
in communications
- - .
=(·--= +=|- ==--·
-~º· ·=--¤|- -
Usually, management
or directors are
involved in proposals
-~º· ·=--¤|- -
-··+-· |---- -¤
=~--·= ==·- -·c-
involved in proposals
and contracts, not
corporate secretaries
=~--·= ==·- -·c-
corporate secretaries.
Letterhead looks
==·-: ¤·= ¤-:º+

home-made
=-- ·¤·c
Frequency of
bidding and
¤= +¤=+ ·--·. -¤
bidding, and
against whom
+=+ -·:=
Company X
Company Y
Company Z
Possible collusion == =~-+ ==~-- —
– bid rotation! ¤= +¤=+ ==|=
Appropriateness of
¤= +¤=+ =|=a-
bidding
¤= +¤=+ =|=a-
„ The company bids on
everything
„ +=|-= =¤¤+= ¤=
+¤= =·c
„ Consultancies
„ Heavy equipment
M di l li
„ |·=·
„ ~· =|+·-
„ Medical supplies
„ Microfinance services
„ Construction
„ ---·= ===-·
„ =¤ ==-+ =--·
„ Construction
„ Etc.
„ =¤ ==-+ =--·
„ -=-
„ =· „ =·
Red Flag Countries
·- ~-: ··-·
Red Flag Countries
„ Companies registered in
·- ~ : ··-·
-=- ··-·= - =- +=|--·=
p g
the following countries,
or with parent companies
in the following:
„ -=- ··-·= - =- +=|--·=
·- ~º+ +=|--· –
„ Bermuda
„ The Isle of Man
„ ¤=:
„ =- =|
„ +=- =|:|
„ The Cayman Islands
„ Gibraltar
„ The Netherlands Antilles
British Virgin Islands
„ +=- =|:|
„ =¤-=·
„ -··-=-: º·===

„ British Virgin Islands
NOT ADB-member
t i i li ibl t
„ ¤==- ~=- =|:|
= ··-· º:¤ =·-= +=|--· -:--.
countries, ineligible to
receive ADB funds.
.
· = ··-·= ·- ~º+ +=|--·
º:¤ ==- |- =- =·= -·--
-~·- +=|--·+ == º+ ---·· |== ~º+ º º
== ¤¤ |+·- ==+== c|¤- ¤==¤¤ c|¤-
-–¤ c|¤-
Ali B b P i i
Al k z m P inting
B l b b P
W
Ali Baba Printing
Alakazaam Printing
Beezlebub Printing
WE-BE PRINTING
Same signature used
for different companies
Documents have
·---=-· |·---
been modified
=·º+ c-
Integrity Workshop, October 2009 , URM/TJRM
Claims are ·--· ·====-
illogical c--
+=|-= =
=:+= =·z
-=- =·+
·- =·+ c
A company p y
claimed to have
built a tunnel
on this road.
Resumes look
i b bl
·=a=- --·--·

improbable
=··-|- ·¤·c
„ Example: a
consultant has
„ =·-·- – |·=··-==
„ --:+ ---+ |=- |+ c
„ An undergraduate
degree from
Harvard
„ ==+ ---+a· |=- |+ c
„ =+=|:+ -=-·( |=-
Harvard
„ A graduate degree
from Yale
=+=| :+ -=-·( |=
|+ c
„ A doctorate degree
from Oxford
Where can you
+- ·-
~-:-· ·r-
„ Pre-bidding documents
y
find red flags?
|=- =+- -·c
„ |- ¤= +¤= ·---=-·
Pre bidding documents
„ The Proposal
„ TECH-1 (for a TA,
„ Letters of Commitment
„ Power of Attorney
„ |- ¤= +¤= ·---=-·
„ |----
„ =+–· ~=- ~a+ ==.
„ |--:- |+-·
y
„ Joint Venture partnerships, agreements
„ TECH-2 Consultant’s
Organization and Experience
„ TECH-3 Comments and
Suggestions on the Terms of Reference
„ =r-=·-=
„ ==a === =~··. =~--·
„ =+–- |·=··-+ ==s- -¤ =-~-
Suggestions on the Terms of Reference
„ TECH-5 Team Composition,
Task Assignments, and Summary of
CV Information
„ TECH-6 Curriculum Vitae (CV)
„ =+–¯ += --·- ==¤·(= =|- -¤
=~--·
„ =+–· ==-+ ¤-=. += ===-·-·. -¤
·=a=- --·-+ =· ( )
for Proposed Professional Experts
„ TECH-7 Personnel Schedule
„ TECH-8 Work Schedule
=a =- --· + =·
„ =+–- |---- ·=-==+ --+ ==
·=a=- --·- =~
„ =+–· +==· -=+
ANYWHERE and EVERYWHERE!
„ =+–= += -=+
=- |- · =¤-·
Exercise –
=-== —
Test your skills! -|:+ ·|-· =---=
„ Compare the two
health certificates
„ ·: -= ---·= |=- |+
··--=
„ Circle the Red

„ ·- ~-:-·= == „ Circle the Red
Flags
„ ·- ~-:-·= ==
===--=
„ Same communications number
„ Same reference to condition
„ º== ==·+ =r=
„ ·-+ == º== =··~
Sa e e e e ce to co d t o
„ Same address
„ Language
„ Grammar errors
„ º== s=-
„ ~
„ ·=+·-= +=-·

G a a e o s
„ Punctuation errors
„ Capitalization errors
„ Spelling errors
„ -·= =·- ==¤·( +=-·
„ s= =·· ==¤·( +=-·
„ -·= ==¤·( +=-·
„ =+·=+-· -=¤= ¤==- ·¤º
„ Although doctors appear to be
British from their names
„ Typographical errors
“Wa5 3RH”
„ =+·=+-· -=¤= ¤==- ·¤º
|-
„ =:|z ==¤·( +=-·
„ -· ¯=·º=
„ “Wa5 3RH”
„ Format
„ Address is flush left, flush right
„ “To whom it may concern”
„ ·=
„ s=- ¤· ¤=. ¤· ·=
„ = === ==¤·(- c
„ To whom it may concern
Actions taken

Verification
==|·- +=-·
|=
„ Called the telephone
number given
|=
„ =|=·( ==|- -=¤·= |-
=·+
number given
„ Belonged to private
residence
„ Googled the hospitals
„ -= ¤·+ ¤=
„ =-|-=-· === =·+

g p
„ Located at different
addresses
„ Called the hospitals (per
i t t i f )
„ -~·- s=--·= =--¤- ¤º
„ =-|-=-·= |- =·+
:·=·-=+ ==-+ =(·=
internet info)
„ Neither doctor works at either
hospital

„ +- |- =+·=+-· =-|-==
+= =·--
Time spent: 30 minutes
==+ === – ¯· =-=
Q ti / Di i Questions / Discussion