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NGO Transparency: Counterpart International to release budget

Editor’s note: Aid Watch received the following statement from Counterpart International in response to a request for comment on Till Bruckner’s post The accidental NGO and USAID transparency test.

We have checked our records regarding Mr. Bruckner’s FOIA request to USAID for information about our Georgia program budget. Our server logs indicate that USAID’s attempt in June to contact us about this FOIA request was unsuccessful because the message was sent to two former Counterpart employees, whose e-mail addresses were no longer active.  As a result, the Counterpart document that Mr. Bruckner received was redacted by USAID without Counterpart’s input or knowledge.

With respect to Mr. Bruckner’s specific FOIA request, we asked for and have now received from USAID a copy of its letter asking for our comments and recommended redactions. We have now responded, asking that only our NICRA rate – which is proprietary and competitive information – be redacted.  USAID has informed us that they will provide Mr. Bruckner with a revised copy of the budget reflecting this change.

Related posts:

The accidental NGO and USAID transparency test
Till Bruckner Responds to Critics on Meaningful Transparency
NGO Response: CNFA Reaffirms Commitment to Transparency
World Vision responds on transparency
USAID and NGO transparency: When in doubt, hide the data
Response from Mercy Corps on Transparency

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9 Comments

  1. Jeffrey K. Silverman wrote:

    Corruption in USAID Georgia/ Transparencygate!

    What are the missions of these organizations, and corruption in USAID and various EU funded programs are well known to locals and others alike.

    As [I[ Jeffrey K. Silverman, Georgia based journalist, wrote some years ago, “it is easy to become inured to discussions about corruption in Georgia. “Corruption is a plague” has a commonplace for politicians and journalists alike. Similarly pat are the explanations why corruption never seems to be cut back: the frozen conflicts with Abkhazia and South Ossetia, the tensions between central government and the regions, the overweening and sometimes threatening presence of Russia. In such circumstances, apparently, the state is weak and cannot be stable and orderly.

    But what largely escapes critical attention is just how vast the international presence in this small country is, how much effort and money has been put in to so little effect. Georgia teems with NGOs and aid organizations (roughly 5,000), so much so that it has become known as an “NGO heaven.” But their impact has so far been limited. The persistent but rarely reported rumors of corruption in the sector suggest one reason for their ineffectiveness. Twelve years after the collapse of the Soviet Union, the relative failure of NGOs and aid organizations calls for a review of their policies.

    Lifting the lid on a can of worms is usually difficult. The non-profit sector is no exception, so it is hard to say quite how worm-ridden the sector actually is. Nor, despite some investigative coups, does the local press have much interest in embarrassing countries whom Georgia owes a debt of gratitude. Still, the sheer volume of rumors suggests there is a major problem–and a few worms do surface. In 2003, the U.S. government recouped money that had been siphoned off from a development program for small businesses into an offshore bank (misleadingly) called Shore Bank.

    It is the only documented instance of some money being recouped. There are accusations of corruption in CARE and United Methodist Committee for Relief, UMCOR, both offshoots of the U.S. government’s aid program USAID, reports of Georgian banks “losing” U.S. government funds, European aid to a micro-finance bank being pocketed

    Admissions are rare. The closest to one came in an email from a federal agent, OIG, who over [who had] investigated several NGOs for USAID’s inspector general, the criminal investigative branch of USAID. “The UMCOR thing,” he wrote, “was closed before I ever came over there and the CARE issues have been investigated and resolved … USAID brought it to our attention soon as they got wind of a problem. Embezzlement. Return of the money. That’s it, … I can’t give out any details.”

    However, the number of shakeups and firings in the organizations is an indirect admission of the scale of mismanagement and, possibly, corruption. Even so, there is no review of policy as a whole. While ministers and heads of NGOs claim that they know what needs to be changed, little is achieved. They need to look more clearly at the layers of problems.

    Money cascades down through various levels. At each there is a problem of interests that detract from the final result. For donors, there is the feel-good factor. Spending money and listing the beneficiaries is paramount. To justifying a project, minor success stories become major success stories. The result is a large gap between needs and action, between achievement and statements. Below that comes a thriving level of intermediaries. Larger organizations often operate pool funds. A local partner, who passes the money to partners to implement the projects, handles the funds. The more levels, the more chance there is of money being diverted.
    Then there is the composition of the staff. In some cases, donors’ try to forge “ties with the local community.” Professional skills are not the decisive factor. The result is that senior local bureaucrats, politicians, and businessmen gain positions. This is part of the problem with the credit unions set by ACDI/VOCA in 1993 and part-funded by the U.S. government. Some of the most notorious corruption in Georgia has involved Micro and SME Credit activities in the South Caucasus countries of Georgia and Azerbaijan. It is hardly accidental that programs have been so unsuccessful that there is even doubt if they were even intended to be effective from the very start. The lineup is impressive as are the case studies: Activities and looted over the years in Georgia and Azerbaijan include Shorebank Advisory Services (SAS), ACDI/VOCA, Save the Children, CARE International, etc.

    NB – it is interesting how many former country directors for USAID have been fired in Georgia in recent years, two from Counterpart International, one from Care International, and one of those fired from Counterpart is now back working in a top position in USAID.

    Jeffrey Silverman, freelance journalist, resident for 16 years and specialist of international development, MS, University of Kentucky.

    Posted August 27, 2010 at 7:32 am | Permalink
  2. Jeffrey K. Silverman wrote:

    Sleeping in the same bed with AEI makes for strange bedfellows for a whistle blower against USAID abuses

    The underlying motivations are not crystal clear, why a lone scholar as Till Bruckner, University of Bristol and who worked in Georgia, is now accruing a long list of enemies who label him a whistle blower, has a sharp axe to grind against USAID’s lack of even a clear and present transparency. Till Bruckner, whose name cannot pull up much at all on a Google search of anything unrelated to his new polemic emerging circa April 2010, which sprang out of nowhere to bemoan the lack of transparency that may be hiding corruption in USAID and their nongovernmental organization affiliates, including their religious aid network? Why would he pick the American Enterprise Institute’s magazine, THE AMERICAN, to lead the armada as a flagship into the murky waters of investigating the similarities between World Food Program and USAID shortcoming? Many people today fear that the USAID may have itself have mutated into a bloated behemoth of intelligence affiliates. Not only Till.

    http://www.american.com/archive/2010/april/how-corrupt-is-the-world-food-program/?searchterm=till

    The AEI is well known and notorious among its detractors for being the birthplace of hard core neo conservatism, which has been a frightful infestation of American democratic ideals and foreign policy for over 20 years now. You may be thinking by now that I am a blind supporter of USAID and the black clouds of legitimate and illegitimate NGOs swarming around USAID and the Republic of Georgia like sweat flies. On the contrary, I have been a long time investigative reporter dredging up such information for public disclosure for a few decades here in the Caucasus.

    The motivations of Mr. Bruckner have been portrayed by some as purely PhD research, but I find this is a mouthful to chew on and not choke. One can simply Google his mentors, allies, and affiliations and see that there is a smorgasbord of envy and jealousy of a vast rival power network such as USAID, to make an overflowing Georgian ‘supra’ table seem meager. USAID now far eclipses the former glory of AEI and their tangled web of patronages

    Something akin to the legendary rivalry between the Templars and the Hospitallers during the Crusades is going on here, and I don’t think I am the only muckraking hillbilly in these here hills that has noticed it so effortlessly, do you?

    And I question if the poor and needy of our planet, and their even more unfortunate brothers and sisters living under bloody repression, who truly need humanitarian aid and development assistance, would be impressed by this infighting and feuding squabble between two juggernauts who in the end will lay out very little for the poor themselves, and leave the recipients questioning the sincerity of the benefits coming from “the American People”. Remember Katrina and Ward 9? Charity starts at home, as well as transparency.

    I have to give Mr. Bruckner credit for coining one of the pithiest sentences I have read in a very long time, “Secrecy and charity make for strange bedfellows.”

    http://aidwatchers.com/2010/05/secret-ngo-budgets-publish-what-you-spend/

    I absolutely agree, and whistle blowing against abuses of U.S. monies exemplified by USAID projects, makes strange bedfellows for AEI.

    Jeffrey Silverman, freelance journalist and former Editor of Georgian Times, resident of Georgia, who has successfully investigated high level corruption and cover ups
    within USAID programs in Georgia, Azerbaijan, and Afghanistan, in the last ten years

    Posted August 31, 2010 at 11:19 am | Permalink
  3. Caitlin wrote:

    Thanks Counterpart, this is a brave and very positive first step!

    Posted September 1, 2010 at 2:01 pm | Permalink
  4. Tim Stamps wrote:

    Did AEI actual plant a guy in University of Bristol, England, to attack USAID for corruption, and is this just a ploy of one large octopus agency, jealous of another counterpart rival giant agency’s superiour financial situation. They both want the same honey pot, and what better way then to attack the weak spot of USAID – its almost total lack of transparency, not to mention all its other faults – it has little to do with development or helping democracies, only to extend US foreign policy interests. It has nothing to do with justice or money for the poor. This battle is more about is about US tax monies and how that money could be better spent at home in solving social problems [this PhD guy from Bristol, regardless of which payroll he is on has done a service], Till Bruckner, rips into USAID corruption and takes no prisoners, but he is on the payroll of AEI or not? That is what I would really like to know before jumping into this firefight.

    I have problems with his motivations – especially since AEI the effective launch pad for his transparency crusade, and not TI, Command and control, and especially the guidance system may be seriously flawed, should this be the case.

    Posted September 1, 2010 at 6:36 pm | Permalink
  5. That might be giving AEI too much credit, and it is appearing that this may have just been the only place that he could get his work initially published. Not only is there a lack of transparency and lack of oversight in USAID but other government funded programs, other than the usual ones. Just take for instance how the US Department of Agriculture wasted money in Georgia over the years. For instance, back in 1998, the United Methodist Committee for Relief, UMCOR was involved in wholesale corruption and even mislead US and Georgian investigators.There was a Vegetable Oil commodity program that suffered severe setbacks. Project personal conspired with buyer of the oil not to pay VAT tax by making up fake tax documents including fake IDs. One former official that I spoke to at the time told me, “we first observed there was problems when we noticed that the oil was being sold at the retail level well below UMCOR’s announced wholesale price plus the 20 percent VAT. This was only the beginning, as this was a joint venture between the NGO sector and government agencies. Even the official profits were placed in Georgian banks (Absolute and Tbilcombank (by UMCOR at less than the official interest rate, receiving 12 percent, when 18 percent for common at the time for even the smallest of deposits. UMCOR had approximately $1,000,000 dollars on deposit at the time. The lost in interest would have been around 40,000 USD over a period of four months. What a costly little deal … and the US government thought it was getting a deal with 12 percent, the bank get chap money, and someone in UMCOR probably got a little something themselves. Either that or UMCOR employees were immensely stupid an negligent … a possibility that cannot be excluded. The next year the financial balance sheets of both banks were in the red and both busted. There is so much NGO money that has gone into financial speculation and to prop up support for corrupt governments, and even some have gone to support terrorism in Georgia and the region, as with rural credit programs that have been operated by those in intelligence agencies, and the money coming from USDA and other sources. All this information is a matter of record with USDA and USAID, Office of Inspector General, however, criminal charges were never brought against those responsible, and the incident was covered by the US Embassy in Tbilisi.

    Posted September 6, 2010 at 7:37 am | Permalink
  6. Till Bruckner wrote:

    @Tim Stamps:
    I do not have a contract with AEI. I pitched a piece on NGOs and food aid in Georgia to the “NGO Watch” website, which seemed an appropriate outlet, given its name. The piece was then published by AEI, with my approval. I received a small sum from AEI after publication – something I had not expected or asked for.

    It’s a sad commentary on the aid world that a wish to see NGO budgets raises suspicions of hidden agendas. I certainly didn’t expect my FOIA journey to last over a year (and running) when I originally asked USAID for the budgets. I remember emailing out the FOIA request just before my summer holidays so I’d have the data in my inbox in autumn.

    The FOIA itself is totally unremarkable, it’s the subsequent reactions – or lack thereof – by USAID and various NGOs that make the story interesting.

    Posted September 7, 2010 at 9:09 am | Permalink
  7. Tim Stamps wrote:

    Few have the guts to send skuds into the ranks of USAID or its webnet of corrupt and non-transparent NGOs. It is no accident that they have reacted in such a manner, as there is so much to hide, and USAID was acting as the first line of defense and even without their knowledge.

    If only the American People knew, and former Senator Jesse Helms of NC was alive today, let God bless his soul, as he had the best solution – cut off all funding to this black hole that does as much damage as it does good, especially in fledgling democracies such as Georgia.

    However, please don’t run around like Idi Amin thinking you are cool … but perhaps a bit naive, as few would have done what you did, indeed, a great service. However, what you did was highly suspect, as too the venue for publication. BUT it had to be done … and the stupidity of USAID and their close-mouth policy of not sharing information is a national shame.

    The same organization preaches the merits of open society and transparency but like a teacher, “do as I say but not as what I do” – and this sets a bad example for countries to follow, especially in a region of the world like where corruption is the culture and aid flows become feeding frenzies.

    I hope you sent the token amount paid for the article back to keep your reputation clear. Better spend it directly on some IDPs, not via a NGO.

    I know that you know that you being watched now, not only for stirring the pot but as the leader of a counter-revolution to all the ills of USAID and their sorted history, and what a better place to start, then Georgia and its many layers of corruption and minions of backhanders.

    I hope you will watch your back and be mindful of where you publish in the future. The message you can share is far more important than the actual delivery system.

    You have my vote and keep up the good work.

    FOIA is a joke and why should one even have to make a request, as all such information, unless related to national security or the so-called war on terrorism, should be open to any and all who would be interested in it.

    Posted September 8, 2010 at 1:21 pm | Permalink
  8. Jeffrey K. Silverman wrote:

    HE IS AN ANGEL FROM ABOVE: He did not know he was to get paid for the article!!!

    Bruckner’s argument is pretty good and reasonable……but remember what you will find if you will do a background on him and he had lots of neocons and DoD type “friends” and colleagues?

    I know from experiences that such pieces usually get paid next to nothing or just 6 free copies of the magazine or under $100. It is normal in the non mainstream media.

    In the name of transparency, how much did Till get paid, and if a check showed up out of the blue or was there was a contact in place. Something is not right, as this is still an open issue, all about transparency and where did the money actually go and now now till appears to be tracked on UN votes and transparency is no a moot issue.

    Posted September 9, 2010 at 5:44 am | Permalink
  9. cynic wrote:

    I hope Tim spent that money on something that can change his outlook life, like beer

    Posted September 9, 2010 at 9:39 am | Permalink
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