Yellen calls for strong action to boost data integrity at IMF

U.S. Treasury Secretary Janet Yellen called for strong action by international financial institutions. This is to protect data integrity and to prevent misconduct in the wake of a World Bank data-rigging scandal. Yellen, in a statement to the steering committee of the International Monetary Fund, also called for moves by international financial institutions. This is to enhance their internal systems for whistleblower protections.

The U.S. Treasury chief said that Washington would monitor developments closely and evaluate any new facts. The IMF’s executive board cleared IMF Managing Director Kristalina Georgieva of wrongdoing after reviewing claims that she and other World Bank officials put undue pressure on bank staff. Washington viewed the allegations as legitimate and serious. Proactive steps are being demanded to ensure the integrity of IMF data. In her statement to the IMF’s International Monetary and Financial Committee and the World Bank‘s Development Committee, Yellen warned that the investigation’s findings could harm both institutions unless they were addressed.

She added that the results of the investigations into doing business irregularities could reduce confidence in the international financial institutions, if there is not strong action to boost accountability, protect data integrity, and prevent misconduct. Yellen has faced criticism from some members of Congress. They don’t know what happened, and now they may never know what really happened. This leaves a cloud of suspicion over future World Bank and IMF reporting of research, Senator James Risch, the top Republican on the Senate Foreign Relations Committee, said. Risch, along with the panel’s Democratic chairman, Senator Robert Menendez, had previously called for full accountability in the matter.

IMFC Chair Magdalena Andersson, said she believed the IMF board conducted a thorough review before expressing its support for Georgieva. Andersson told reporters at an IMFC news conference that it is truly a thorough work that was done by the IMF board. The conclusion from that thorough analysis is that there is a unanimous, and full support for Kristalina. The saga is far from over for the IMF. Treasury will monitor the IMF’s follow-up closely. WilmerHale, the law firm that investigated the matter for the World Bank‘s board, is working on a separate report. This is about possible wrongdoing by bank staff.

Treasury officials will evaluate that second report as soon as it is released. The World Bank said that there is no specific deadline for WilmerHale for completing the report. The report would go to the bank‘s human resources department and was unlikely to be publicly released since investigations involving staff are confidential, said a spokesperson.