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Yellen calls for ‘strong action’ to boost data integrity at IMF and World Bank By Reuters

© Reuters. FILE PHOTO: Secretary of the Treasury Janet Yellen attends the House Financial Services Committee hearing in Washington, USA, September 30, 2021. Al Drago / Pool via REUTERS

By Andrea Shalal and David Lawder

WASHINGTON (Reuters) – US Treasury Secretary Janet Yellen on Thursday called for “strong action” from international financial institutions to protect data integrity and prevent misconduct in the wake of a US data manipulation scandal. World Bank.

Yellen, in a statement to the International Monetary Fund’s steering committee, also called for action by international financial institutions to improve their internal systems for whistleblower protection.

The US Treasury chief said Washington would closely monitor developments and assess any new facts and findings should they become available.

The IMF executive board cleared IMF Managing Director Kristalina Georgieva of wrongdoing on Monday after reviewing claims that -future-later-monday-2021- 10-11, she and other World Bank officials unduly pressured bank staff to modify the data in the 2018 Doing Business report to favor China.

Yellen notified Georgieva at the time that, although there was insufficient direct evidence to justify his removal, Washington considered the allegations to be legitimate and serious. He also demanded proactive measures to ensure the integrity of IMF data and the protection of whistleblowers.

In his statement to the IMF’s International Monetary and Financial Committee and the World Bank’s Development Committee on Thursday, Yellen warned that the research findings could harm both institutions unless addressed.

“The results of investigations into the irregularities of Doing Business could reduce confidence in international financial institutions if strong measures are not taken to promote accountability, protect data integrity and prevent misconduct,” he said.

IMFC President Magdalena Andersson, who is Sweden’s Finance Minister, said she believed the IMF board carried out a thorough review before expressing support for Georgieva.

“It is really a painstaking job done by the IMF board, and the conclusion from that painstaking analysis is that there is unanimous and complete support for Kristalina … the way she is carrying out her job as the managing director of the IMF,” Andersson told reporters at an IMFC press conference.

The saga is far from over for the IMF, said a source familiar with the matter, underscoring the gravity of the findings in WilmerHale’s research report.

The Treasury will closely monitor IMF monitoring and expects its “requests” to Georgieva to be fulfilled, said the source, speaking on condition of anonymity.

WilmerHale, the law firm that investigated the matter for the World Bank’s board of directors, is working on a separate report on possible wrongdoing by bank staff regarding the manipulation of data found in the 2018 Doing Business reports and 2020.

Treasury officials will evaluate that second report when it is released, the source said.

The World Bank said there is no specific deadline for Wilmer Hale to complete the report, noting that the law firm was tasked with conducting a thorough review and following up on all leads.

A World Bank spokesperson also noted that the report would go to the bank’s human resources department and was unlikely to be made public, as investigations involving staff are confidential.

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