CAO Cases

Arne Hoel, The World Bank

Latin America & the Caribbean

Honduras / Ficohsa-02/Tela

Garifuna Community, Fraternal Black Organization of Honduras
Date Filed
October 09, 2015
Land grabbing, displacement, environmental degradation, lack of economic benefits
Case Status
Open - Compliance



Banco Ficohsa (Ficohsa) is the largest bank in Honduras.  Following earlier investments to support trade finance, housing and SME loans, in May 2011 the IFC Board approved an equity and sub-ordinated debt investment in Ficohsa (project #29257).  As part of the Tela Bay Tourism Project in Honduras, Ficohsa is one of the financiers that have provided more than $20million towards the development of boutique hotels, vacation homes and condos in the Indura complex (Tela Bay project).


In October 2015, an Indigenous Garifuna community lodged a complaint with CAO with the support of a local NGO, Fraternal Black Organization of Honduras (OFRANEH).  The complaint alleges a number of issues stemming from the Indura development project, including land grabbing, community displacement, lack of economic benefits and environmental degradation.

                                                                                                                                                                                                                                                               CAO Action

CAO found the complaint eligible for assessment in December 2015, and conducted multiple field visits to discuss options for addressing the complaint with the relevant parties. During the assessment process, CAO understood from community members that pursuing a dispute resolution process was not an option at this point in time. An assessment report was released and in line with CAO’s Operational Guidelines, the complaint was referred to CAO's compliance function for appraisal. 


CAO released its appraisal report in June 2017. As CAO previously prepared a compliance investigation of IFC’s investment in Ficohsa (released August 2014, link below), CAO’s appraisal considered IFC’s performance in relation to its supervision of Ficohsa as it relates to the Tela Bay project. After a review of IFC’s documentation CAO has identified questions in relation to the adequacy of IFC’s supervision of E&S risks that relate to the issues raised in the complaint. Firstly, CAO has questions as to whether IFC adequately assured itself that its client applied IFC’s E&S requirements to the project. Secondly, CAO has questions as to how IFC supported its client to ensure that the E&S issues raised in the complaint have been adequately assessed and, where relevant, are being managed in accordance with IFC’s requirements.


While these circumstances would ordinarily merit a CAO compliance investigation, given CAO’s ongoing monitoring of IFC’s investment in Ficohsa, CAO has decided that a separate compliance investigation is not required. Rather, CAO will consider the issues raised by the Tela Bay complaint as part of its ongoing monitoring of IFC’s investment in Ficohsa.


Issues raised in this complaint are being considered as part of CAO’s monitoring of IFC’s investment in Ficohsa.


                                                                                               Status as of June 9, 2017.

Project information

Project Name & Number
Ficohsa 26394, 27341, 29257
Global Financial Markets
Banco Financiera Comercial Hondureña S.A.
Latin America & the Caribbean
Environmental Category
$20m, $35m, $70.1m

Case Tracker


  • Eligible: Completed
  • Assessment Period: Transferred


  • Under Appraisal: Completed
  • Monitoring: In Process

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