World Bank President Robert Zoellick, in a statement, said South African President Thabo Mbeki had agreed to release McCarthy from service to take up the position as vice president of the bank's Department of Institutional Integrity on June 30.

The World Bank anti-corruption unit investigates fraud and corruption in development projects financed by the global development agency in developing countries, and McCarthy will lead an overhaul of the department.

"Leonard McCarthy is recognized worldwide for his integrity, independence and effectiveness in fighting corruption and strengthening good governance," Zoellick said.

McCarthy's appointment comes a day after Mbeki's government agreed to dissolve the Scorpions, bowing to pressure from supporters of rival and head of the governing African National Congress, Jacob Zuma, who accused it of political abuse.

In 2005, the unit raided properties belonging to Zuma and his lawyer as part of an investigation of the politician, who is scheduled to go on trial in August for fraud, bribery and other wrongdoing tied to an arms scandal.

The ANC leadership last year voted to dissolve the unit, officially known as the Directorate of Special Operations. The unit was established by Mbeki to fight high-profile corruption cases and scored successes against organized crime in a number of cases.

On Monday, an independent report by Judge Sisi Khampepe defended the Scorpions, arguing it was needed to tackle organized criminals in the crime-infested country.

While urging Mbeki to retain the Scorpions, the report also criticized the unit for feuding with police and delving into matters outside its realm.

The unit was independent of the police and reports to the National Prosecuting Authority, which in turn answers to the South African Justice Department.

McCarthy has held numerous positions in government, including investigating director in the Office for Serious Economic Offenses, deputy attorney general of the Cape province and senior public prosecutor. He was appointed as a director of public prosecutions by former President Nelson Mandela.

The World Bank's integrity department has not been without its own controversy over the past several years, amid concerns about its investigative practices and pressure from member countries that the bank must do more to root out corruption.

Former U.S. Federal Reserve Chairman Paul Volcker led a panel last year to examine the World Bank unit's role amid criticism of its director, Suzanne Rich Folsom, who resigned in January.

Volcker's panel said tensions and friction between the World Bank anti-corruption unit and the rest of the bank undermined the unit's ability to do its work properly. It suggested the bank find ways to better integrate its work into mainstream operations.