US says IFC covering up sex scandal in Kenya schools

 

The US government has claimed that the International Finance Corporation (IFC) tried to cover up reports of child sex abuse at Kenya’s Bridge International Academies moments after investigations against the low-cost private school began.

According to the Treasury Department, the IFC entered into a “supplemental confidential” in what may have been aimed at covering up cases of sexual abuse soon after the Compliance Advisor Ombudsman (CAO) started the probe.

It is a fresh blow to the IFC, the World Bank Group’s private investment wing. World Bank President Ajay Banga last month rejected allegations that IFC sought to cover up reports of sexual abuse.

“We are deeply troubled by the broader accountability issues raised by this case. These include IFC’s agreement with Bridge to put in place a supplemental confidentiality agreement following the initiation of the CAO’s investigation,” said the Treasury Department in a statement.

CAO started the investigations into complaints of child sex abuse at Bridge International. CAO is the World Bank’s internal watchdog on projects its two arms: by IFC and Multilateral Investment Guarantee Agency (MIGA) projects.

The CAO report, the US Treasury Department said, unearthed “unacceptable failures at the IFC identified”

“The investigative report (the CAO Report) disclosed on March 14 confirmed numerous incidents of child sexual abuse between 2013 and 2020 at schools in Kenya run by Bridge International Academies (Bridge), a former IFC client,” said the US Department.

As the only World Bank shareholder that retains veto power over changes in the Bank’s structure, the US plays a unique role in influencing and shaping development priorities.

Read: World Bank denies IFC abuse cover up in Bridge schools

The CAO started investigations in 2020 when allegations emerged about widespread sexual abuse at the schools.

In response, Bridge said IFC’s agreement to undertake a review of its entire portfolio to identify all projects where children are vulnerable and assess if appropriate social risk management measures are in place and operationalized, will ensure children have greater protection globally.

“Bridge remains steadfast in its commitment to collaborate with the government and other stakeholders to strengthen safeguarding policies and practices,” Bridge said in a statement adding that it looks forward to continuing to work with IFC and other organizations committed to child safeguarding across Kenya to strengthen support for survivors of abuse.

The World Bank held a $13 million (Sh1.75 billion) stake in Bridge International Academies from 2013 to 2022. But with the sex abuse reports, the IFC it divested from the programme.

The IFC exited the New Globe Schools, the parent company of Bridge International Academies after making investments, including equity purchases of over $10 million (Sh1.34 billion) in the company since 2013.

IFC said the investment helped increase the number of schools under Bridge International, which targeted children from families earning less than Sh200 per person per day.

It sold the undisclosed stake to an institution that has been associated with Bridge International for more than a decade.

By the end of 2022, IFC had invested a total of Sh111.7 billion in 31 Kenyan firms with banks being the biggest beneficiaries.

IFC has become the biggest lender to local banks that in turn use the funds to boost their capital and expand lending, including categories prioritised by the global financier such as climate-friendly projects and women-owned businesses.

IFC’s investment projects have, however, come under pressure to comply with various ethical and sustainability issues.

Companies in which the IFC has invested have been forced to comply with sustainability issues such as ensuring diversity in staffing and tackling human rights violations.

Education International (EI), a global federation of teachers' trade unions, had been leading efforts to have the IFC stop its support for Bridge by arguing that investing in private for-profit operators contravenes the global commitment to inclusive and equitable quality free education for all.

A 2017 report from the UK MPs acknowledged that “it is clear that Bridge is a contentious partner,” and said that particular inspectors in Uganda reported that children were being taught in “substandard facilities and unsanitary conditions.”

By DOMINIC OMONDI