Module 4:  Common types of corruption in project construction

Refusal to issue final certificate

Example:

A contractor has properly completed the works and is entitled to receive a final certificate which will entitle it to receive its final payment of $500,000 from the project owner.  The project engineer has a duty under the contract to issue the final certificate if the works have been properly completed.  The engineer knows that the works have been properly completed and that the certificate should therefore be issued, but refuses to issue the final certificate to the contractor unless the contractor pays him personally 10% of the final certificate value ($50,000). 

Explanation:

This is extortion and abuse of power by the project engineer.  The engineer should issue the final certificate due without demanding personal payment. 

If the contractor makes the payment to the project engineer in order to receive the certificate, the contractor will be liable for bribery.  In this situation, there is no threat by the project engineer of any personal harm to any of the personnel of the contractor, so the defence of payment to avoid personal harm is not available.  It is unlikely to be a defence if you make the payment in order to avoid financial harm.

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April 2025
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