Global Fund seeks to recover $116,000 from Tajikistan after procurement fraud

4 May 2015
A government sub-recipient was found to have significantly overpriced non-health products bought with Global Fund grant money

The Global Fund will seek to recover some $116,000 in misused funds from Tajikistan attributed to improper procurement practices by a government sub-recipient of an HIV grant managed by the UN Development Program.

In an investigation report released in late March, the Office of the Inspector General determined that the Committee for Youth, Sports and Tourism (CYST), overpaid a supplier by more than $109,000 -- primarily for non-health products. An additional $7,000 was paid for products for which there was no proof of delivery.

All of the transactions were done with a single supplier, which was awarded the contract through a non-competitive process. Other questionable practices revealed during the OIG investigation included inconsistent documentation and invoicing by the supplier and the sub-recipient, and a deliberate disengagement from standard operating procedures and normative practices in procurement by CYST.

CYST has been removed from the list of eligible SRs in Tajikistan as part of a series of measures taken by UNDP in the wake of the investigation, which was in part jointly conducted with the UN body's own audit and investigations team.  Representatives from the OIG traveled together with UN audit investigators to the Tajik capital, Dushanbe, in August 2014.

Aidspan understands that once a final recoverable amount has been set by the Global Fund, that information will be conveyed to UNDP, along with a timeline for the requested repayment. UNDP will then have to find a way to recover the funds from the now-former SR.

Other oversight measures taken by UNDP include routine budget checks and training in best practice in procurement, supply chain and financial management. Going forward, all principal recipients will share information about which suppliers are reliable and which are black-listed.

UNDP has served as a PR for Tajikistan since 2003, overseeing the more than $139 million in grant funds disbursed across the portfolio of HIV, TB and malaria activities.

The country submitted concept notes for HIV and TB funds in April 2015 under the new funding model. UNDP is likely to remain the PR for Tajikistan through the next allocations period, until 2017.

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