Mismanagement, fraud, and corruption at UNOPS: the Executive Board must act now

4 April 2022 – Mukesh Kapila

UN headquarters in Copenhagen. Image at Shutterstock

Letter addressed to the President of the Executive Board of UNOPS

Copenhagen, 4th April 2022

H.E. Ms Yoka Brandt, Permanent Representative of the Netherlands to the United Nations in New York, PRESIDENT, EXECUTIVE BOARD OF UNOPS (& UNDP, UNFPA).

Dear Madam President, Excellency,

I refer to the 25th March letter from the UNOPS Executive Director, Ms Grete Faremo, seeking the Executive Board’s guidance.  I write in the global public interest, in solidarity with thousands of concerned current and past UNOPS personnel as well as other donor and client stakeholders. They are extremely  disappointed and angered by grave wrong-doings at UNOPS, for which they seek accountability.

My locus for doing so is my own standing as a former senior official of the United Nations system, including at UNOPS. I have also been a major governmental funder of the UN system and UNOPS. I have both commissioned and been a client of  UNOPS services in various senior roles. Like you, I have also served on some UN agency boards. My international experience in development aid, humanitarian action, human rights, and global health in many multilateral institutions, has spanned some 40 years.   This can be consulted here, if needed, and via innumerable official and public references.

I would be grateful if you could kindly share this communication with your Executive Board members with, I hope, prospect of formal discussion during a Board session. Meanwhile, this is shared with the UN Secretary-General Mr Antonio Guterres, Deputy Secretary-General  Ms Amina Mohammed, and Assistant Secretary-General Mr Ben Swanson at UN OIOS.  It is also shared with the Permanent Representatives of all Member States at the United Nations in New York, accompanied by a request for onward transmission to all Capitals.  In the interests of transparency, it is also published openly.

The matter at hand concerns the potential loss of around US$60 million of donor and client funds under the charge of UNOPS. There is strong prima facie conclusion that these funds were mis-directed by wilful senior-level mismanagement at UNOPS including potential fraud and corruption.  

In her 25th March letter to you, Ms Faremo offers the defence of separation from mainstream UNOPS by stating that the “challenges” are limited to S3i and refer to the period before 2019. This is disingenuous. S3i  (and a predecessor WATO initiative) were special projects of UNOPS itself, designed and executed by UNOPS leadership, operated under rules and authorities bestowed by UNOPS, and financed from UNOPS reserves. As such UNOPS is wholly responsible and accountable for them.

Neither did the “challenges” cease in 2019. First, the questionable post-reduction of interest charges took place in 2020. Second, the highly unethical request made to UNOPS staff to fund Nick Provenzano’s (son of the UNOPS Legal Counsel) company was made in January 2021, and several S3i innovation projects were approved under questionable circumstances in January/February 2022. Third, the Executive Board’s approval of a specific S3i reserve continues to allow the possibility of transfer of funds to entities associated with the fraudulent scheme. Finally, although UNOPS is currently engaged in legal action to recover misappropriated funds, most of the staffing and processes that created the problems are still in place, thereby compromising the recovery process.

You are aware that Assistant Secretary-General Vitaly Vanshelboim, former Deputy ED and CEO of the S3i initiative has been accused, in numerous public statements, by Ms Faremo for being solely responsible through “possible misconduct”, even as the long-running investigation by the UN Office for Internal Oversight Services (OIOS) is yet to rule on this.  The Board hardly needs reminder that it is a principle of justice that a person is considered innocent under proved guilty. Ms Faremo appears to be bent on perverting that course.

Regardless of the case against Mr Vanshelboim, it is not credible that he could have acted alone to divert such large sums by evading stringent UN rules and multiple layers of UNOPS checks and controls. That  points towards negligence or connivance on the part of Ms Faremo and her Senior Leadership Team  of  Honoré Dainhi, Marianne de la Touche, Nick O’Regan, Jim Provenzano, and Peter Browne. Other key officials in critical compliance and clearance functions, namely Hafida Lahiouel, Paul Lucas, Kelley Swift, and Kathryn Higgs, also bear responsibility and must be held accountable. 

In her 25th March letter to you, Ms Faremo denies the charges that have been levelled at her, that is that she has herself undermined the functions of diligence and accountability including legal, financial oversight, ethics, and human resources management. The Executive Director is deliberately concealing and  mis-representing the truth.  Some of the arguments can be seen in articles dated  4th March,  9th March, 22nd March, 26th March, and  3rd April, accessible from here.   Fuller evidence can be found in the internal records of UNOPS, once they are made openly available.  Ms Faremo has not been transparent or candid in her previous briefings to the Board.

Therefore, the investigation that Ms Faremo has fought hard to limit to Mr Vanshelboim, must be widened to identify all conspirators and ensure all due accountabilities. This is vital to learn all lessons, conduct corrective reforms in structure and procedures, and ensure the future integrity of UNOPS.

As Ms Faremo has said, placing Mr Vanshelboim on administrative leave “is a precautionary step in order to allow an administrative process to be conducted fairly”. For the same reason, it would be prudent to place the Executive Director and SLT on administrative leave too, pending conclusion of the wider investigation.

There is a further urgent reason to do this.  There is mounting concern that, over these weeks, UNOPS may be tampering with the evidence needed for investigations. UNOPS leadership has also embarked on a strong and expensive campaign of suppression and intimidation of staff who have spoken up on the wrong-doings or are thinking of doing so. This is a violation of its own whistleblower and other ethical and staff protection policies. This is to be understood against the long-standing context of its flawed top structure whereby the crucial control and compliance functions report directly to the Executive Director. The concentration of power and influence, and non-separation of powers, allows Ms Faremo a degree of impunity unknown in other UN agencies or, indeed, in any well-governed modern enterprise.

The Board is also advised to recognise that egregious fraud and corruption at a UN agency can’t  be treated as just an administrative matter to be handled through internal UN procedures. Grave offences appear to have been committed that are more appropriately examined by the law enforcement authorities of a state with jurisdiction. That could be Denmark where UNOPS is headquartered or the United States where the Board is located or Finland where UNOPS/S3i is housed. The Board should ask the UN Secretary-General to lift the immunities and privileges of  relevant officials to permit that.

The Board could also consider setting up genuinely independent external  scrutiny, using the precedence of the Volcker Inquiry into the Iraq ‘Oil-for-Food’ Programme that led to the then UN Secretary-General Kofi Annan accepting “ full responsibility for his own failures and regretted his lack of diligence in pursuing investigations of alleged misdeeds.”

Meanwhile, it is also safer for the Board not to rely solely on Ms Faremo and her implicated senior officials as the sole conduit for receiving information that, as said already, is unreliable. The Board could consider measures such as confidential hearings that allow staff and other stakeholders to raise their concerns, and for relevant documents to be openly released.

In concluding, Madam President:

The fraud and corruption at UNOPS occurred because of mismanagement, misconduct and misuse of  authority among UNOPS leadership who also manged to avoid and subvert Board governance. But this only happened because the organisation was allowed to stray from the high values and standards of the United Nations, and also through the ill-considered expansion of its mandate and scope, going beyond operations into policy dimensions for which it was not founded.  The vulnerabilities thereby created at UNOPS continue to place it at huge future risk.

It follows that the Board should take the opportunity of the current crisis to review and revise the overarching policies and strategies that led to these vulnerabilities including the profiteering business modalities that allow UNOPS to accumulate obscene levels of reserves, and  drive it towards reckless behaviours.  That is not how UN agencies should conduct themselves, under any circumstances.

The arrival of the new Executive Director is awaited with great anticipation and should be accelerated, as a long transition is not in the interests of the agency, especially its hard-working staff serving faithfully at the frontlines of complex needs.

At such a critical moment in history, we need UNOPS more than ever. Decisive action to restore trust in it has never been so necessary nor so urgent.  

With assurances, Excellency, of my highest consideration,

I remain, yours most sincerely,

Professor Mukesh Kapila, CBE

Published by Mukesh Kapila

See http://www.mukeshkapila.org

52 thoughts on “Mismanagement, fraud, and corruption at UNOPS: the Executive Board must act now

  1. UNOPS staff are fuming with anger 😠. How come this is not yet in the press. Selective reporting by mainstream media?

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    1. Not all ugly deeds are revealed here, including a certain senior man (also mentioned in a previous article) unethically promoting junior woman because of his personal favoritism towards her in the New York team. OIOS has received reports on these two perpetrators. If Jim hiring his son was investigated, this older man + young woman in New York also needs to be investigated by OIOS (obviously UNOPS HR are too cowards to investigate).

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  2. Investigators should not hesitate to look in all the transactions between UNOPS and Mexico government.

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    1. I totally agree!! Mainly considering that everything relays in Fabrizio Feliciani’s hands and his protegés(one of them was a lobbyst for one of the many corrupt presidents in Ecuator! The rest are a bunch of incompetent colombians thirsty for power and obscene high monthly fees… there is not a single ICA in his team below 14K monthly!!!)

      As for other regions, Moin surroinding himself by weak british men at the same low level as Nick Or.l “milking” hosted entities. Sanjay using asian woman to clean his dirtiness in a bunch of projects with Australian $$. Bana and her team doing nothing, just increasing their pension funds. And well, we all know Honore and his group of frenchs in the regional office, pretending to understand what an infrastructure project is, just to overcharge budgets and keep their useless structure.

      @Mukesh, would be great to see articles about each region! Im sure UNOPS personel reading this post and comment can share most information about the wrongdoings and fraud.

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  3. @Marco S

    excellent idea to have some special blogs, dedicated to the individual regions and what is really going on there behind the curtain.
    Let’s shed a bit light on how the Regional Kingdoms conduct their business, how they cover up the big “success stories” and how they squeeze the working class colleagues like lemons, till no juice is left and then throw them away.

    Sempre Fi

    J

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  4. In the absence of a transparent leadership and a credible, effective Internal Grieveances mechanism to deal with personnel complaints, let’s expect more dirty laundry to be washed in public.

    How did a once respected organization get here?

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  5. Morality is the ability to distinguish between right and wrong. All UNOPS personnel are expected to be moral agents. However, at UNOPS, senior leaders when they commit misconduct are not judged according to ordinary policies as it applies to the rest of the personnel. In their case, the discourse changes from the need to hold them responsible for their actions towards one of exuberant sympathy and protection from PCG.

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  6. @CK

    shall we go by the alphabet and start with Africa, Asia, Europe, Middle East, New York, South America, HQ

    Sempre Fi

    J

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  7. Happy to contribute to all the ugliness from the New York office to the blog: Dionyssia, a white woman, sent a letter to the entire office to ask people not to participate in the Black Lives Matter movement; Peace and Security Cluster squandered their money in extravagant retreats at places like Gurneys Montauk (average room rate $1000/night); William Axelsson (the son of Grete’s close friend—-talking about nepotism at UNOPS) shamelessly made Sarah O’Neill–a woman young enough to be his daughter with no prior UN experiences–his favorite woman in front of Grete and SLT overnight. Most job posts in the New York office are only posted for 2 weeks because they all have hand-picked people (like relatives in Jim’s case) to cheat a fair recruitment system.

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  8. UNOPS staff raised concerns about how the SLT is conducting their business but nobody listened. The creation of the EAC+ were all the S3i projects and the WATO project were approved clearly shows that was a premeditated plan.

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  9. Bastiat once said, “when plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”

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  10. Apart from SHS, which other private companies did UNOPS dismburse funds to?
    In Nigeria SHS does not have a title deed of the land where they suppose to build the houses. They tried to manipulate the owner of the land to sign fake documents but he did not agree.

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  11. He who passively accepts evil is as much involved in it as he who helps to perpetrate it. He who accepts evil without protesting against it is really cooperating with it.

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  12. Look at NYSC, quite a few skeletons there. Past few years openly enabling bullies to take over the controls. Misconducts and incompetency flourishing – making a way to much worse things. Stories will keep coming up. If you only knew of people who left NYSC humiliated and in tears. They had all good intentions for the organization, but left cause staying was worse.

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  13. The Executive Board should revist its decisions about how much reserve UNOPS can keep. UNOPS use these funds for fraudulent activities such as investing in SHS or to pay UNOPS retainers (90% from European countries)

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  14. The so called investment fund which only benefits countries where the Directors are favored by RDs should also be throughly investigated.

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  15. @AR
    It is really amazing,

    On Monday, 22 June 2020, the United Nations Secretary-General António Guterres stated that “we need to raise our voices against all expressions of racism and instances of racist behavior” in the wake of the killing of George Floyd,
    and then, a member of UNOPS in NY, Dionyssia, sent a letter to the entire office to ask people not to participate in the Black Lives Matter movement?

    Seems UNOPS is not only good in mismanaging donor funds but has so much moved away from the UN and its core values, that they simply don’t care what the SG says because it appears, UNOPS seems to be beyond and above the UN regulations, its values and simple human decency.

    ….. now let me guess @AR, there have been severe consequences for Dionyssia, correct?

    Sempre Fi

    J

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    1. You don’t want to know what those paper-pushers in New York say or do. UNOPS colleagues around the world work in the most challenging regions and actually help people. But people in New York office enjoy their happy hours, fancy retreats, cigar bars, beach vacations, promoting girlfriends, hiring sons while facing no consequences for inhuman actions. Makes your blood boiling, isn’t it.

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  16. Unlimited power in the hands of limited people always leads to cruelty. Vitaly is not only the SLT member misusing his power. There is another member who is blinded by his ego and forever making irrational decisions.

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  17. UNOPS personnel globally have always been extremely committed to the cause. Regions work under pressures from the top, under complex ‘due diligence ‘ and burn their own nerves to get things done in time. It’s the change in the culture on UNOPS that has taken the organization into this course, and the entire SLT has been actively part of this change. It’s not the regions, they are only trying to keep their business running, it’s the pressures, the added complexities which is only applied to the ‘really effective’ field projects in the field but not to the large risk items apparently. The SLT in its entirety is accountable. This was also made worse by a new HR direction and a disfunctionsal Ethics Office that is accountable to the Executive Director.
    It’s a pity to see UNOPS going down like that. But if UNOPS is to survive this wave, the current leadership in it’s entirety needs to admit, apologize and resign immediately. This way, if they cared, there is a chance for unops to learn and survive. They are harming everyone by not doing that.

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  18. Today I found this text on LinkedIn:
    UNOPS Multi-Country Office in East and Southern Africa is looking for talented specialists in Rule of Law to work on an exciting capacity building programme on Transnational Organized Crime in East Africa. The position will be based in Antananarivo, Madagascar and will also cover Comoros, Mauritius and Seychelles.

    Isn’t it fascinating to see how an organization that is embroiled in obviously one of the biggest corruption scandals in the UN history, is bold enough to stand up and claim to have the skills and moral philosophy to teach others about fighting organized crime……
    Maybe the SLT Director Dainhi would be a great Project Manager 😉

    Sempre Fi

    J

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  19. The UNOPS is also the UNDP Executive Board. This Board has allowed the UNDP top management to cover up the stealing of millions of dollars on a GEF project in the Russian Federation and nobody has been held accountable despite admission of a major screw up and a conclusion that the OAI investigations were all interfered with by senior management. Donors to the UNDP and UNOPs Executive Board were told the GEF climate change project in Russia was a ‘one off’ which is a joke. These problems are systemic and are happening on a regular basis as millions are siphoned off and very rarely are people held accountable. Staff are invariably scared to report over fear and concerns about retaliation.

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  20. I must thank you for the efforts you have put in penning this blog. I am hoping to view the same high-grade blog posts by you later on as well. In fact, your creative writing abilities has motivated me to get my own, personal website now 😉

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  21. I hope UNOPS personnel find time to complete the questionnaire sent to all staff on racism which is one of the deadly vice in UNOPS.
    In UNOPS racism is institutionalized. How many black people did UNOPS recruit to PCG or Ethics office? Black people grieveances are hardly addressed because they are considered not important but noise.

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    1. It’s not only that, in the days of Tina it was an open secret that Danish and Northern European personnel had preference. The entire composition of CPMG speaks to that.

      I recall Tina making the comment that she doesn’t need to pay personnel from poorer countries as much as the Northern Europeans because they’re still making much more than they would back home.

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      1. Yes, but hats off to the PCG learning section, they at least try to have propotional geographical representation in their courses.
        I also noticed the hardwork of the team working on diversity and inclusion but as they say, the fish rots from its head.

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  22. @Victor,
    yes, you are right, HQ is putting significant pressure on the Regional offices and the RDs to get the business they need to live their fancy lives in the ivory towers in Copenhagen and NY.

    But that is no excuse that RD’s do not stand up against that pressure but simply refer the pressure down to the Hubs and country offices. We talking about D2 Senior Staff and not ICA 2 or 3 who do not have any protection from abuse and arbitrary firing.

    By doing so they just become willful accomplices of corporate and let’s not forget, the RD’s have their on kingdoms and they need to be financed too. RO’s are cost-centers and not revenue-centers.

    Subsequently Corporate and Regional Offices have joint in to squeeze the juice out of the country offices or did you ever hear that a Regional Office was closed down because the $$ flow was not substantive enough?

    Maybe you should talk to colleagues that used to work once in the China office in Beijing, how they have experienced the shut-down of their office, there is enough for a Netflix blockbuster.

    Sempre Fi

    J

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    1. I don’t disagree.
      Do people know that the person who actually blew the whistle to OIOS is now on administrative leave put into force by the ED of UNOPS. This is nothing but retaliation. Where is the UN whistle blower protection? Where is the SG and his Deputy? The clean person in UNOPS who stood up is on administrative leave since the start of the year. There is no protection, it’s either you are with them, or you leave, and often you don’t decide on how you would leave!
      This is precisely the culture that the ED and her SLT brought it. This was never the case under the previous ED. Since she came on board, several senior managers were let go or decided to leave because they stood up and we’re clean. Today, UNOPS SLT not different than what mobsters do. After all, the SLT come from historically colonizing countries and cultures (Norwegian, British and it’s affiliated Australia and NZ, and French)! All of the management team is made up of those nationalities. They support each other into key positions, just like they are pushing up the British PCG Deputy following a plan since years, and the British Reece in NY, the Ozzie boy of Grete in Nepal, therr is the Ozzie Chief of staff, the Ozzie Audit and Investigations, the Ozzie now-ex Ethics Officer, and before her the British Mitchel, and the British Communication muppet who lives in a world of his own, and not to mention the British Director of project implementation and Standards! The Director who was promoted twice in two years in record time to become the first director UNOPS has ever hired without a masters degree. He doesn’t have any degree but he was promoted directly after the ED’s visit to his country office where he did the necessary to deserve the favoritism and nepotism he enjoyed in being given the first ever waiver for the lack of academic qualifications from an announcement that required such, where he was forced into the short-list by her despite the ‘recruitment agency’ not including him, the recruitment agency that was hired for $100,000 to cover up the clear intentions, who actually then ranked him as third with concerns, but then of course he was selected by Ms Grete Faremo because he helped her with a ‘personal mission’ paid for by UNOPS, including the flowers that were bought for a cause that is very close to her heart, in a country which happened to be his office location! He came to HQs with anger management, sexual abuse including of an intern, he even showed his penis on a desk in front of colleagues in the office! He implemented ‘standards’ together with all-british infrastructure team, and he became a member of the SLT right away.
      PCG has been playing along all these wrongdoings, after all she also wants a promotion, and so has the Ethics Office, the Communications Puppets, and so on. That’s the way things work.
      The SLT should save what could still be saved, if they had any conscious minds remaining, and leave immediately. How can they walk the corridor looking their colleagues in the face? And can they deny all this. This is all supported by proof and evidence. Ask about the whistleblower, ask about the recruitment process of Nick and Boyden’s report and costs which was kept a secret between very few people in PCG, ask about the flowers invoices of Grete’s visit of 2016, ask about when and why Grete wanted to make Jerusalem the Regional bureau location for the middle east in 2016 against all political and operational logic, ask about why they created the center of excellence instead and then the center was closed down after Nick went to Cph, ask about why the Ethics Officer declined a review requested by the whistleblower, ask about why all the past senior managers who were hired under Jan Mattsson were all let go one way or the other, those who maintained the clean culture of commitment to UNOPS. Ask for answers!
      Vitaly is not the main wrong-doer, but he standards out and alone. It’s a gang, they are abusers, retaliators, and there is no place for clean people around them. The SLT should admit, apologize and resign.
      Why doesn’t Norway live up to its self-promoted standards and ask her to resign along with her team?
      So I agree with you John, the RDs are cowards or not principled enough to stand up, but this culture came from Grete Faremo and her SLT. Otherwise, it’s simple to retaliate, like they did with many past managers and they will get away with it because the UN SG and the system does nothing about it.
      It’s starts from cleaning the top.

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  23. Bottomline: On top of the pressure to deliver projects, Hubs and Country Offices are also under pressure to raise funds which include management fees to pay salaries for personnel at Regional Offices, Liason Offices and Headquarters. Instead of the RDs appreciating all these efforts they are blackmailing hubdirectors.

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  24. Reading all the comments here made me realize that abuse of authority, retaliation and lack of proffesionalism is UNOPS culture.

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  25. the abuse and retaliation are so egregious. They don’t treat people with dignity. Look who is managing the law at UNOPS? Jim Provenzano gotta to go. NY office needs to be dissolved.

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  26. @lof,

    carefully, when you start with dissolving NY and continue that path, only the country offices will remain from UNOPS and HQ, the Regional Offices and some Hub-Offices will disappear….. hmmm maybe not such a bad idea after all.

    Agreed, the outright disregard for the “conflict of interest” policy in the UN by UNOPS and especially Jim Provenzano, can only be resolved by dismissing the legal council and his subordinates. The only upright and straight person there is none other but Benedetta. She always works clean and honorable but 1 bird does not make a summer.

    Sempre Fi

    J.

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    1. you didn’t hear that benedetta is not there anymore? she definitely got retaliated against her for doing the right things.

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  27. Many thanks for this platform Mukesh.
    For some SLT members is time for soul-searching. How do some people sleep knowing that they destroyed people’s livelihoods?

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  28. Write to saveunopsiicas@gmail.com
    A US lawyer is on standby to help all UNOPS personnel for wrongful termination. Please spread the word to ask UNOPS IICA contractors who were discriminated against, retaliated against, owed money, wrongfully terminated, racially against to write to this email. A class action is being formed.

    Like

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