According to Human Rights Watch, the World Bank’s private investment firm, International Finance Corporation (IFC), lent $15 million to Corporacion Dinant, a Honduran food company, despite indications that it was forcing people off their own land and controlled security forces that engaged in multiple killings.
“The IFC loaned millions of dollars to a project, even though it was known that its operations were already enmeshed in killings and other violence,” said Jessica Evans, senior international financial institutions researcher and advocate at Human Rights Watch. “As President Kim urges World Bank staff to take on riskier investments, the Dinant case should serve as a warning about the pitfalls of investing without proper oversight.”
The CAO found that IFC staff had underestimated risks related to security and land conflicts, and that they did not undertake adequate due diligence even though the situation around the project and the risks had been raised publicly. Nor did IFC project staff inform other IFC specialists on such environmental and social risks about the problems that they knew were occurring.
The investigation stemmed from allegations that Dinant conducted, facilitated, or supported forced evictions of farmers in Bajo Aguán, Honduras, and that violence against farmers on and around Dinant plantations in the Bajo Aguán, including multiple killings, occurred because of inappropriate use of private and public security forces under Dinant’s control or influence.
The CAO found that the IFC did not, as its policy requires, adequately oversee Dinant’s obligations to investigate credible allegations of abusive acts committed by the company’s security personnel or to sanction the use of force that goes beyond “preventative and defensive purposes in proportion to the nature and extent of the threat.”
Read the whole report here. See here, here, and here to read about detrimental U.S. policies towards Honduras that contribute to the kind of atmosphere in which government-allied corporations abuse the people and security forces engage in killings with impunity.