Head of Latin America’s Leading Development Bank Faces Impeachment Vote over Misconduct Accusations

Head of Latin America’s Leading Development Bank Faces Impeachment Vote over Misconduct Accusations

The main member states of the Inter-American Development Bank are expected to vote to remove the bank’s president, Mauricio Claver-Carone, after an investigation uncovered misconduct over an undisclosed romantic relationship between him and a bank employee, according to senior officials. government officials from countries with large turnouts in the vote. in the bank.

People familiar with the matter said the bank’s shareholders unanimously supported the ouster of Claver-Carone after a law firm conducting an investigation for the bank found evidence that he had had a relationship with a bank employee who reported to him. The investigation also found that Mr. Claver-Carone approved a 45% base salary increase for the senior staff member in less than a year, the people said.

Claver-Carone could not be reached for comment. He said in a statement posted on the bank’s website earlier this week that he supported and cooperated in the investigation. He denied having a relationship with the employee and said the investigation did not substantiate “false and anonymous accusations” made against him in news reports.

“Despite the absence of due process, I fully cooperated without giving up my constitutional rights,” he added.

A bank spokesman said he had no information on the vote by the bank’s board of directors. People familiar with the situation said the board recommended Thursday that Claver-Carone be removed.

A Cuban-American who served as senior director for Western Hemisphere Affairs at the National Security Council during the Trump administration, Claver-Carone became the first American citizen to lead the IDB, angering governments in the region since he his appointment broke the tradition of having a Latin American head of the institution. Before joining the Trump administration, Mr. Claver-Carone had lobbied for the US trade embargo on Cuba. And in the White House, he was a key architect in tightening the sanctions on Havana and Venezuela.

In mid-2020, the Trump administration nominated him to lead the IDB, a Washington-based multilateral lender that last year provided more than $23 billion in loans across the region to support anti-poverty, health, education and infrastructure programs. .

The final decision on Mr. Claver-Carone’s removal will be made by the bank’s board of governors, which is made up primarily of finance ministers from member countries. Member states including the US, Brazil, Argentina, Mexico and Colombia, which together have more than 60% of the total vote, are expected to approve the impeachment next week, people familiar with the situation said.

“After a thorough, independent and credible investigation that found misconduct that violated the principles and values ​​of the Inter-American Development Bank, and after consultation with partners, the United States supports the removal of the president of the IDB,” said Michael Kikukawa, spokesman for the IDB. United States Department of the Treasury.

People familiar with the matter said the United States was concerned about what Claver-Carone viewed as a lack of cooperation during the investigation, including a refusal to hand over his bank-issued phone and other records.

“Chairman Claver-Carone’s refusal to cooperate fully with the investigation, and his creation of a climate of fear of retaliation among staff and borrowing countries, has lost the trust of the bank’s staff and shareholders and requires a change in leadership. ”, said Mr. Kikukawa. he said.

Mr. Claver-Carone’s nomination to head the multilateral lender broke a six-decade tradition in which a Latin American held the presidency of an institution that also provides technical advice to member states.

write to José de Córdoba at jose.decordoba@wsj.com, Juan Montes at juan.montes@wsj.com and Andrew Duehren at andrew.duehren@wsj.com

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