World Bank Misconduct in Afghanistan – A Case of Corruption, Extortion, and Retaliation

In 2019, Unicon Ltd., a British contractor, signed a World Bank-financed contract with Afghanistan’s Ministry of Energy and Water to assess gas reserves, improve infrastructure, and supervise construction of the Sheberghan to Mazar-i-Sharif gas pipeline (SMPL Contract) – work the World Bank Group itself needed to mobilise $145 million in donor financing for its programmes in Afghanistan.

Almost immediately, Afghan officials moved to coerce bribes. They engineered a 20% deduction from Unicon’s payments under a fabricated tax claim later shown to be unlawful. Unicon refused to submit and insisted that the contract be honoured. What followed was not an ordinary commercial dispute. It was a coordinated campaign of extortion, corruption, theft, and institutional retaliation – one in which the World Bank played an active and documented role at every critical stage.

The extortion was explicit. Audio recordings captured senior Afghan officials warning Unicon that, if it refused to pay bribes, its invoices would never be paid. By April 2019, Unicon was prepared to leave the project, cut its losses, and waive the unpaid invoices accrued to that point in order to avoid years of litigation. The World Bank intervened personally and urgently. Bank officers in Washington praised Unicon’s “amazing, incredible work” and gave written assurances that the company would suffer no financial loss if it stayed. The Bank’s own language was unequivocal: it was not “IF,” but “HOW UNICON WILL BE COMPENSATED,” even if the fictitious tax was imposed by the Afghan Government. Relying on those assurances, Unicon stayed. In doing so, it crossed the very point it had warned the Bank it could not cross – the point beyond which unpaid losses could no longer be forgiven and litigation would become inevitable. The Bank confirmed that it understood this fully. Those assurances were given against that exact backdrop of extortion, threatened non-payment, and Unicon’s explicit warning that any further performance would push the company past the point of no return.

Once Unicon delivered the key work, the Bank broke every promise it had made. It stood by while the Afghan Government withheld payment for work already performed. Unicon was ultimately forced out of its own project and replaced by a more accommodating firm willing to operate within the corrupt scheme. The World Bank approved both steps: Unicon’s removal and the engagement of the replacement contractor.

Unicon was left to fight for justice alone. It later prevailed in international arbitration, where a tribunal ruled in its favour and ordered the withheld funds to be released. Yet the World Bank did more than betray its promises to protect Unicon. It crossed from supposed protector to direct beneficiary of the corrupt scheme itself – retaining for its own benefit both the work product and funds that should have gone to Unicon, preserving the very outcome that corruption and retaliation were designed to achieve. That is what makes this case so disturbing: a development institution that promised protection instead shielded corrupt actors, kept the benefit of Unicon’s work, and profited from the very misconduct it was supposed to prevent.

Once Unicon was removed, the project collapsed and Afghanistan lost infrastructure that could have brought badly needed electricity to poor communities. This Report picks up where the earlier Curtis report left off: the fraud and corruption that derailed the original Mazar Gas-to-Power procurement returned in repackaged form under the SMPL contract, with even graver consequences.

This is the story of a contractor that refused corruption – and of the World Bank that covered for corrupt actors while preserving the fruits of their scheme.

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The Report:

Letters: