We Wrote A Report On What The Red Cross Did With A Half Billion Dollars Donated For Haiti Relief. We are reporters from ProPublica and NPR. We're Joined By A Haiti Aid Expert And A Former Community Organizer in Haiti. Ask Us Anything.

Can you give us the tl;dr version of what they did with the money?

EDIT: Thanks for the gold, whoever you are.

Tl;dr: we don't have a full answer. Laura and I repeatedly asked the American Red Cross for a detailed breakdown of spending by specific project/overhead, etc. They wouldn't provide that. They do release a pie chart of spending in their annual report: https://www.documentcloud.org/documents/1568746-haiti-five-year-update.html#document/p1/a210740

But it's broken down only into very broad categories. So if you want to actually figure out what happened to the money, it's not very helpful.

Apart from tracking the money, here's the nut graf of the story:

"The group has publicly celebrated its work. But in fact, the Red Cross has repeatedly failed on the ground in Haiti. Confidential memos, emails from worried top officers, and accounts of a dozen frustrated and disappointed insiders show the charity has broken promises, squandered donations, and made dubious claims of success."

This document shows a typical reporting tactic that the vast majority of NGOs use; not just Red Cross. Admin (or "overhead") expenses are allocated to various functional areas such as Sanitation, Shelter, etc. based on some (hopefully standardized) methodology. It's used for M&E (Monitoring & Evaluation) purposes which abstracts financial data for use in calculating the social return on programs. The thing about this data is that there's no standard framework they are required to use to produce these numbers. They could allocate their admin/overhead down to zero if they wanted to (it looks like that's what was done here). So... incorrect? Technically no. Misleading? You betcha. That's good NGO marketing!

They couldn't report this stuff to the IRS, as GAAP accounting principles are required for actual regulatory bodies (duh). That data exists, of course, but as you've pointed out, they have no legal obligation to comply with requests for such data.

Source: I'm a non-profit consultant accounting, systems, and management consultant.

Hi -- I'd love to chat more about your work, if you have time shoot me an email [email protected]

Can you provide details of the other problems with their work? I give money to the Red Cross and am wondering if my money would be better elsewhere. What are some of these 'string of failures'. Also is the claim that they provided home's to 130,000 Haitians true? They only built 6 houses but provided rental subsidies - does this 130,000 figure stand up to scrutiny? thanks.

Hi, my name is Jonathan, and I'm work for the Reporting and Analytics team with the International Services Department of the American Red Cross who is very familiar with the data behind some of their claims. What Justin and his fellow reporters fail to do is accurately explain what the 130,000 number means, and the context that would help someone understand why the Red Cross planned its strategy as it did. My team and I responded to over 100 questions over several months about the details of this number, which these authors chose to ignore.

As someone that lives and breathes what are called "logframes" (or logical frameworks), I can try to explain what the authors failed to. Indicators are built into these logframes, which organize your work in order to show progress towards your goals. The 130,000 people are shelter beneficiaries from different indicators across many different projects. Justin failed to capture in his article the context of the housing issue in Haiti. Simply building houses would be an easy indicator to measure, for sure, but wouldn’t solve the problem. A “build it and they will come” is a strategy that has been tried, and does not work in Haiti. People want to remain close to their families and livelihoods. So greenfield development is out. When it comes to building in cities, obtaining land rights from the government became a challenge that was too difficult to overcome at the scale we were looking to work on.

So what else goes into the 130,000, if we only build six permanent houses?

We put tens of thousands of people into new “transitional shelters,” built with the help of organizations like Habitat for Humanity. Helped pay the rent for people to move into apartments (after all, the vast majority of displaced people were renters to begin with). We’ve trained people how to build stronger, more disaster-resistent homes. We helped relocate people with unconditional cash grants. And much more.

And not included in this count are those that benefitted from more than 850,000 tarps distributed in the first days of the response.

EDIT: I forgot to mention one of my favorite projects, a retrofitting project that fixes and strengthens existing homes!

Hey Jonathan,

As we noted in the story, the Red Cross has said it “provided homes” to more than 130,000 people. But that’s not accurate. That figure includes people who, for example, got construction training — not a home.

The story also notes the Red Cross did repairs on several thousand of homes and built several thousand transitional shelters.

We focused on permanent housing in part because the head of the Red Cross, Gail McGovern, announced early on that that would be the Red Cross’ focus. But a number of programs to provide permanent housing either failed or fell short. For example one of the planned projects to build new neighborhoods was delayed for years “because of turnover in Red Cross leadership that resulted in shifting approaches to housing in Haiti” — that’s from a GAO report: https://www.propublica.org/documents/item/1669909-gao-haiti-testimony.html#document/p18

In the original story, there's the following bit:

NPR and ProPublica were "creating ill will in the community, which may give rise to a security incident," the email says. "We will hold you and your news organizations fully responsible."

What was it like to receive a response like that? It seems to me like a blatant intimidation attempt, so I'd be really curious as to both your initial takes and any broader perspective you've gained, as well as if there were any other questionable American Red Cross statements.

We were fairly shocked to get that email. Earlier that day we had been talking to Jean Jean Flaubert, who is the head of a local community group in the neighborhood of Campeche that was actually set up by the Red Cross. We were accused of providing false information to community members when in fact we had shown them a Red Cross press release about the project from the group's website.

Excellent piece of investigative journalism. I've always been a fan of ProPublica's reporting.

How has the response to the investigation been, from the public, governments, Red Cross? Has the lack of specific information about expenditures in Haiti triggered any sort of external audit? Ultimately, who holds the Red Cross responsible?

Thanks. Let's see, the Red Cross has released several statements you can read on their site: http://www.redcross.org/news/article/The-Real-Story-of-the-6-Homes-Answering-Questions-about-Haiti

The story has gotten a lot of attention from the media in Haiti -- we actually just published a piece about a press conference that was held this week during which Haitian journalists demanded answers from a Red Cross official: https://www.propublica.org/article/haitian-reporters-demand-answers-from-red-cross-and-dont-get-many

And a congressman has called for hearings here in the US, as well. Unclear if that will happen or not.

(addendum: there are also some really interesting comments on the story from various aid workers who have been in Haiti https://www.propublica.org/article/how-the-red-cross-raised-half-a-billion-dollars-for-haiti-and-built-6-homes#disqus_thread

Hi guys, I listened to the whole piece last week and was blown away. Obviously the Red Cross is a PR powerhouse and seems to have lots of agents and spinners in this AMA replying to top level comments in lieu of your responses, almost like theyre trying to hijack this AMA to defend their vague financial disclosures and dubious recovery accomplishments. Is this a common problem having Red Cross mouthpieces paid to follow you around and try to distract or sway the opinion of your audience?

As I was mentioning above, this actually happened last time we did an AMA about previous Red Cross reporting: https://www.reddit.com/r/IAmA/comments/2kw3dj/were_propublica_reporters_just

But again, it's not a problem -- we're happy to discuss our story with anyone. We had extensive correspondence with the Red Cross before publication and their answers are reflected in the story.

[deleted]

This actually happened last time we did an AMA on our Red Cross/Sandy reporting last year: https://www.reddit.com/r/IAmA/comments/2kw3dj/were_propublica_reporters_just

But obviously the AMA is open to anyone!

What tipped you off to this story?

Is there potential for a class action lawsuit?

Good question. Laura and I (and another colleague, Jesse Eisinger), did a lot of reporting last year about the American Red Cross' response to domestic disasters. Our main story was about issues with the response to Hurricane Sandy in New York: https://www.propublica.org/article/the-red-cross-secret-disaster

After we published that, we began to hear from current and former Red Cross employees recommending we take a look at the Haiti program. Generally these were people who were troubled by what they had seen and thought there should be an accounting.

In re: class action -- I'm not a lawyer so I wouldn't want to weigh in

Is there a history of the Red Cross failing in its claims and promises, or is this more of an isolated situation?

We have found that it's not isolated. We were told repeatedly while reporting on the response to Hurricane Sandy that there is reason to doubt the Red Cross' claims about their work.

https://www.propublica.org/article/red-cross-ceo-has-been-misleading-about-donations

From that story: The Red Cross says that it served 17.5 million meals and snacks during the Sandy relief effort. It has used that number in responses to inquiries from New York State Attorney General Eric Schneiderman.

But multiple current and former staffers and volunteers raise questions about the accuracy of those numbers.

During major disasters, the Red Cross often counts meals that are prepared as meals served, according to 11 people ProPublica spoke with. (Most spoke to ProPublica on the condition of anonymity because they still worked for the Red Cross or feared alienating the charity.) That difference is important because large volumes of meals that are prepared are ultimately not served, but rather thrown out because of poor planning and the chaotic nature of disasters.

One former staffer, from a chapter in Massachusetts says, "The idea that the numbers are based on people getting the meals is ludicrous," adding that "there's no mechanism to report how much is actually served."

The Red Cross told ProPublica and NPR that it stands by its public "meals served" numbers and says it has a policy in place to count them. It provided us with forms volunteers are required to fill out to track meals.

Have any large scale, legal investigations been launched to look into what's going on? Can those who lead the Red Cross be held responsible if it's determined that they've mishandled funds?

Also, what's the best thing that the average person could do to assist in this situation?

The GAO (the investigative arm of Congress) is currently working on a report about the Red Cross (though not focused on Haiti). And a congressman has called for hearings about the Haiti program. Not clear if that will happen yet. It turns out that even though the Red Cross is private, it was chartered by Congress and so lawmakers can do oversight of the group.

In general -- not just with the Red Cross -- if you give money to a group, you should know that you're in a position to demand meaningful transparency. Write letters/emails etc.

Hello, thank you for your AMA!

Your investigation seems to observe and question the "mismanagement" of the American Red Cross. Did you try to investigate the management of other societies of the Red Cross that were involved in Haiti?

We didn't look closely at other RC societies, which are autonomous entities. We do know there were a lot of different societies active in Haiti. Though the American Red Cross by far raised the most money.

First, thank you for that report. I am a journalist in Nepal and I am sure you know that Nepal is going through a situation that is very similar to what Haiti went through. Here too, international aid agencies like the Red Cross and other are extremely pervasive. After the devastating earthquake here, we are trying to rebuild in a way that is transparent, accountable and sustainable. These seem to be the catchphrases for every I/NGO, though they are rarely practiced.

My question is, how do we do what you did? But not five years on. How do we hold to account international agencies like the Red Cross, who are so powerful in poor countries like ours that they can pretty much dictate policy.

Nepal doesn't want to be another Haiti. What would you recommend we do to stay vigilant so that we don't become another Haiti?

One simple thought of what you can do as a journalist: keep on it. What's happening to all the money that was donated? Demand an accounting of the money from big agencies (and governments) and if they don't give it, write that they won't give it...

Is there any transparency in how compensation works for Red Cross employees and executives? Do they potentially receive more money if more money is raised, like a commission?

There are some disclosures on their annual tax return in terms of salaries -- but only for top officers: https://www.documentcloud.org/documents/1102501-2013-american-red-cross-tax-return.html#document/p11

Is there any way, any chance in hell, that this was the result of innocent mistakes and just poor management, and not something worse? Is there any reason to remain even vaguely optimistic about this organization?

Hope never dies. But what I can say is that the employees of the Red Cross have lost faith in the current leadership of the organization. We obtained and published an internal employee survey last year that goes into more detail: https://www.propublica.org/article/internal-survey-shows-the-red-cross-own-employees-doubt-the-charitys-ethics

In response to the statement, "I trust the senior leadership of the American Red Cross," just 39 percent responded favorably.

In response to the statement, "The American Red Cross shows a commitment to ethical business decisions and conduct," 61 percent responded favorably. That means about 4 in 10 respondents doubt the ethics of the venerable charity.

I've seen some stories that the majority of the money for Wounded Warrior Project goes to the executives at the charity and to marketing. Have you thought about investigating Wounded Warrior Project?

Not familiar with them but we're always looking for story ideas. My email is up above and you can find other ProPublica contacts here: https://www.propublica.org/about/contact

I just this morning attended a red cross class, where the instructor (who is probably not the most reliable source for this info) said that the money was given to subcontractors, who then misused/stole it without preforming the contracts. Is there any truth to this, is it a possibility, or should it be dismissed?

Hard to know what to make of that, but if you have information, please email me [email protected]

Have you guys seen the Vice episode on this topic if so could you comment on their research?

Yeah -- was an interesting piece. Jake (in this AMA) was actually in it

130000 vs 6 is quite the difference in number. So did the Red Cross just waste the money for the other 129994 homes, did they overpay for the six homes, does it include repaired homes ( since i imagine that would be cheaper than building new)? Was it evened realistic of them to build 130000 in the first place (total for all other groups was only a few thousand, so maybe the goal was impossible). 130000 vs 6 is quite the disconnect and I would like to delve into that particular number further.

That 130k figure does include home repairs, and putting up transitional shelters, as we discuss in the story. The money is actually still largely a black box. The Red Cross has said they spent $173 million on shelter, but we have not been able to get detailed breakdown of the financials of where exactly that money went.

While investigating, did you learn about Team Rubicon's work in Haiti? If so, what was your impression?

I've heard of them, but not much by way of specifics.

Hello Justin, Laura, Francois, and Jake. Favorite soup, sandwich, dessert?

Pumpkin soup or "soup Joumou" is Haiti's most famous soup and there is a long history behind it. Dessert is "pain patate" which is a pudding made of sweet potato. As for sandwich, I dont know of anything special.

None of you have a favorite sandwich? I am not asking about Haitian food.

Anything from here: http://www.alidoronyc.com/