In Search Of The Red Cross' $500 Million In Haiti Relief An investigation by NPR and ProPublica finds a string of poorly managed projects, questionable spending and dubious claims of success, according to a review of the charity's internal documents.

In Search Of The Red Cross' $500 Million In Haiti Relief

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NPR's Laura Sullivan has spent the last several months reporting on the American Red Cross. Last fall, along with ProPublica, she brought us an investigation into their response to Superstorm Sandy, and she's here with us again. Hey there, Laura.


CORNISH: So you've turned your attention now to the American Red Cross and their response to the earthquake in Haiti.

SULLIVAN: That's right. It was one of their biggest fundraising efforts ever. Millions of people donated. You might remember the Super Bowl fundraiser that the American Red Cross did. Michelle Obama came out and called on Americans to donate. It was a huge outpouring of support.

CORNISH: And what was the result? How much money did they raise?

SULLIVAN: We're talking about almost half-a-billion dollars. After the initial emergency relief aid, the American Red Cross said it was going to spend that money rebuilding neighborhoods and rebuilding lives.

CORNISH: But did they? What did you find?

SULLIVAN: Well, we looked through hundreds of internal emails and memos and interviewed current and former employees of the Red Cross. And what is clear is that what the Red Cross was saying it accomplished in Haiti is very different from what it actually has, so ProPublica's Justin Elliott and I went to Haiti to try to figure out where some of that money went.

UNIDENTIFIED MAN: (Foreign language spoken).

SULLIVAN: Here in the sprawling city of Port-au-Prince, most people don't have drinkable water or toilets. Many live in squalor. Half of all kids don't go to school. That was true before the earthquake and it's still true now. The government's annual budget without foreign aid was about a billion dollars. So if you had half that amount that you could give to this country, what would you do with it? The American Red Cross said it was going to rebuild lives and rebuild neighborhoods. But ask a lot of Haitians where they think that money went, and they will tell you they don't have any idea, even the country's former prime minister.

JEAN-MAX BELLERIVE: Five-hundred million in Haiti is a lot of money. It's a lot of money.

SULLIVAN: Jean-Max Bellerive was Prime Minister until 2011. He knows the country's budget and what that kind of money can do.

BELLERIVE: I'm not a big mathematician, but I can make some additions. It doesn't add up for me.

SULLIVAN: I went to meet Bellerive one day recently with ProPublica's Justin Elliott. We found him in his living room high above Port-au-Prince talking with Joel Boutroue. Boutroue was the U.N. deputy special representative in Haiti, and he says he doesn't know where the 500 million went either. As they sip coffee, they consider the Red Cross's claim. All the money went to help 4.5 million Haitians get, quote, "back on their feet."

BELLERIVE: No, no, it's not possible. We don't have that population in the area affected by the earthquake.

JOEL BOUTROUE: You know, 4.5 million people is almost all - it was 100 percent of the urban area in 2010 - 100 percent. That would mean that the American Red Cross would have had to serve the entire cities of Haiti.

SULLIVAN: It wouldn't be unheard of for the Red Cross to make such a claim. Not long ago, the charity hired a group of consultants to review one of its projects in the north. They found the charities math unreliable when it came to counting people it helped. There was double-counting, undercounting, and in one instance, the Red Cross claimed to have helped more people than actually live there. So how did the Red Cross spend half-a-billion dollars in Haiti, and what exactly does it have to show for it? We obtained hundreds of pages of internal documents and interviewed more than a dozen current and former Red Cross officials. We found a string of poorly-managed projects and questionable spending.

The Red Cross has always been known for its media disaster relief work, providing things like food and blankets. It did that work in Haiti as well. But the Red Cross has very little experience in the work of rebuilding in a developing country, and yet, the charity outraised other nonprofits by hundreds of millions of dollars to do just that. Now, five years later, the total number of new homes the Red Cross has built in Haiti is six. We took our reporting and documents to the Red Cross and sat down with David Meltzer. He's the Red Cross's top lawyer and runs the international division. Meltzer told us that the charity helped millions through trying and difficult circumstances.

DAVID MELTZER: The Red Cross has provided clean water, sanitation, vaccinations, disaster preparedness, cholera prevention. All of the money that has been spent has been focused on benefiting the people of Haiti.

SULLIVAN: But that's where things get tricky. The Red Cross says it took the almost 500 million and split it into sectors - 69 million on emergency relief, 170 million providing shelter, 49 million on water and sanitation and so on. The Red Cross will not say what kind of programs they ran, how much they cost or what their expenses were. Neither would David Meltzer.

MELTZER: Well, you can certainly see in our five-year report what percentage of the dollars have been spent on shelter, on water, on sanitation.

SULLIVAN: Why can't you tell us where you spent the money and what your expenses were? You obviously have that information. Why can't the public see that?

MELTZER: We have provided, through our public website, information about where the money has gone by sector. And we stand by the accuracy of that information.

SULLIVAN: Without question, the Red Cross spent millions of dollars on food, tents and water tablets. It gave money to new hospitals, vaccination programs, portable toilets, a water treatment plant. But spend some time reading through the Red Cross's internal documents, and you'll also see that much of the money the charity raised never reached people in need.

That's because the Red Cross outsourced most of the hands-on work to other charities, which breaks down like this. First the Red Cross takes out a customary administrative fee. Then the charities they give money to take out their own fees. But even after those fees, the documents show the Red Cross takes out an additional cut to pay for what it calls the management cost of running these third-party projects. In one case, we found all of these costs ate up a third of the money that was supposed to go to helping Haitians.

But if you really want to understand what happened to the money in Haiti, take a look at one of their marquee projects - a housing project because housing is where most of the money went. And it's where the charity made its biggest promises, like their project in and around the neighborhood of Campeche.


SULLIVAN: We went there one afternoon recently. Campeche sits on a ravine in the hills of Port-au-Prince. It was poor before the earthquake, and it's still poor now. Many people live inside shacks made of tarps and tin. There's no running water. Trash and human waste piles up at the bottom of the hill.

UNIDENTIFIED WOMAN #1: Bonsoir. Bonsoir.

SULLIVAN: As you walk past people's homes on the steep alleyways, everyone - one shack to the next - smiles and greets you. Above them, at the top of the hill, the Red Cross has painted its name and logo across a large concrete wall.

JEAN JEAN FLAUBERT: (Speaking Creole).

SULLIVAN: Jean Jean Flaubert was here when they painted it. He's one of the neighborhood's leaders. As he walks through the alleyways, he tells us that about three years ago, the Red Cross came with glossy booklets. He explains in Creole to our translator that officials said they were going to build hundreds of new homes, a water and sanitation system, a health clinic.

FLAUBERT: (Through interpreter) We still have tents here. I'm going to show you that Red Cross has never intervened here at all. People shouldn't have - not have been living like this still.

SULLIVAN: The Red Cross promotes this project heavily. It's in its annual reports and press releases under the headline Rebuilding Neighborhoods. It's costing $24 million.

FLAUBERT: (Speaking Creole).

SULLIVAN: From the main roadway, Flaubert calls to the other leaders to join him in the one-room community center. Inside, the men pull plastic lawn chairs around a metal desk. A man named Simon Julnet opens a filing cabinet and spreads the booklets the Red Cross gave them in 2012. Inside is the list of priorities they and the Red Cross came up with for their area - homes, clinics, water, bathrooms. Asked about each one, the men shake their heads no.

UNIDENTIFIED MEN: (Speaking Creole).

SULLIVAN: The men tell us they think it's possible that the Red Cross is still going to build them homes, but maybe they just haven't gotten to their neighborhood yet. Flaubert says they have asked the Red Cross repeatedly to tell them what is going on.

FLAUBERT: (Through interpreter) OK. He said we are fighting now with the American Red Cross, and still, we don't have any answers.

SULLIVAN: We didn't have any answers either, but we did have a Red Cross promotional brochure. So we showed it to them. Far from building new homes and new neighborhoods, it says the Red Cross is doing smaller projects, like repairing some walkways and homes and schools. It is also paving a road. The brochure says these projects in Campeche and the surrounding area are costing $24 million. The men look at each other, stunned. Julnet is the first to speak.

SIMON JULNET: (Through interpreter) I don't understand an organization like the Red Cross acting like that. If they have received that kind of money, maybe they pay their employees with it. That's okay. But that kind of money spent here in our community? No, that cannot be said.

UNIDENTIFIED MAN: (Speaking Creole).

SULLIVAN: The men break into a heated conversation in Creole. They pause and look at us and our translator.

UNIDENTIFIED WOMAN #2: OK. What he was saying - he was asking if there is a way that we can bring the Red Cross here to a meeting with them. I was explaining to them that we are not able to make them come.

SULLIVAN: He was asking if we could bring the Red Cross to them.

Later that night, after we left Campeche, the head of public affairs for the Red Cross in Washington sent us an email saying we had mischaracterized the project to residents. The public affairs official said we were, quote, "creating ill will in the community, which may give rise to a security incident." "We will hold you and your news organizations fully responsible," the Red Cross said. No security incident ended up happening, but residents did ask if they could keep the brochure.

When we went back through the Red Cross's internal emails and memos from the project, we found the original plan was to build 700 new homes with living rooms and bathrooms. The charity says it ran into problems with land rights. But its records show there were also multiple staffing changes, long internal delays over hiring and a bureaucratic approvals. And then there was a period when the whole project appears to have sat dormant for almost a year. While all this was happening, a thousand miles away in Washington, D.C., at Red Cross headquarters, things weren't going much better.

CORNISH: That's NPR's Laura Sullivan. When we return, she'll continue her investigation into what happened to the nearly half a billion dollars Americans donated to the American Red Cross following the 2010 earthquake in Haiti. Stay with us.


We return now to our examination with ProPublica of the American Red Cross's response to the 2010 earthquake in Haiti. As we've heard, the charity promised to help the country rebuild and had nearly half a billion dollars to work with. After the initial emergency relief, the charity turned much of its focus to housing, and frustration grew in Haiti over project delays. NPR's Laura Sullivan picks up our story in Washington where things weren't going much better.

SULLIVAN: The Red Cross's memos and emails are a clue into what was happening at the organization's headquarters. There were multiple warnings about internal delays clogging up efforts to get projects off the ground. Frustrated managers in Haiti wrote notes as they waited for approvals from headquarters. Lee Malany was one of them. He ran the Red Cross's housing and shelter program starting in 2010, and he says problems started right after the earthquake.

LEE MALANY: They never had a real plan for what they wanted to do in housing.

SULLIVAN: Malany remembers flying from Haiti to Red Cross headquarters in D.C. with several colleagues in October of 2010. They gathered in a conference room with the charity's top leadership. He says the senior managers didn't seem to have any idea how to spend tens of millions of dollars set aside for housing.

MALANY: When I walked out of that meeting, I looked at the people that I was working with and said, you know, this is very disconcerting. This is depressing - no talking about what is our overall program and if we do this, where's it going to go and is this the best place to go.

SULLIVAN: He says the leadership, including Red Cross CEO Gail McGovern, seemed more concerned with which projects would generate good publicity.

MALANY: She was the one that made the statement - well, I think that would be OK; that would look all right. And the way I read it - to translate it is, is that this would look OK on the checklist. And we would give it to the public, and we wouldn't get any push back.

SULLIVAN: Red Cross officials dispute Malany's description of the meeting and say they did discuss housing strategy and would never put public relations over Haitians' needs. Three years after that meeting, though, documents show officials in Washington were still struggling with how to spend housing money. McGovern wrote an email to her senior staff in November of 2013 saying a particular housing project was, quote, "going bust." We're still holding 20 million, she writes; any ideas on how to spend the rest of this besides the wonderful helicopter idea? That's a common reference in economics to giving money away, as in throwing it out of a helicopter. But officials wouldn't say if that's what she meant. Either way, it's not what she promised donors and the public in 2011. Back then, McGovern went before a luncheon at the National Press Club in downtown D.C. She said a fifth of the money the charity raised would go to provide Haitians with permanent housing.


GAIL MCGOVERN: To provide tens of thousands of people with permanent homes where we develop brand new communities, including water and sanitation.

SULLIVAN: After five years and millions of dollars, the total number of new permanent homes the Red Cross has built in Haiti is six. According to their own account, the total number of brand new communities is zero. Many of the projects they did start seem to go nowhere. Take a 13-million-dollar development effort in the northern part of the country. We read the Red Cross's own recent review of the project, and it found local residents are angry because it's been more than two years, and they don't see anything useful happening. Very little, if anything, has been built.

The review found that officials spent some of the money on a campaign to teach residents to wash their hands with soap and water. The reviewers then note that these residents do not have access to soap or water. Then there was another project in a place called Quartier-Morin. It's been wracked by delays and high turnover. First, the project spent two years on hold, then got canceled. The Red Cross spent another year trying to come up with a new project that the U.S. government would oversee. Now the U.S. government has the money and is currently looking for another charity to run this four-year-old housing project that has yet to produce a single home.

MELTZER: For the American Red Cross and the Red Cross in general, shelter has been a priority.

SULLIVAN: David Meltzer, the lawyer from the Red Cross, says land ownership and government issues were often outside of the charity's control. He says the Red Cross has provided homes for more than 130,000 Haitians.

MELTZER: I think if you go to the people and ask them where they are living today, they will tell you, I'm living in my home.

SULLIVAN: But if you go in search of tens of thousands of new homes in Haiti, you won't find them. The Red Cross acknowledged this in an email. The vast majority of that number is made up of people who went to a seminar on how to fix their own homes, people who received temporary rental assistance and thousands of people who received temporary shelters, which start to disintegrate after three to five years.

To be sure, building in Haiti is very difficult. Land title and government requirements are complex and time-consuming. But still, it can be done. A nationwide review found other charities have built almost 9,000 homes so far. Not far from the Red Cross's neighborhood development project in Campeche, two charities, Global Communities and PCI, built 260 one-story homes and 75 two-story homes and rebuilt the main road in Ravine Pintade. Now the charities are building a series of multifamily homes with running water.

JOHN WILDY MARCELIN: (Through interpreter) This little house will have two bedrooms. And this is the kitchenette living room, and this will be the bathroom.

SULLIVAN: John Wildy Marcelin is head of construction. He says this project's had a lot of momentum because the majority of the managers are Haitian. He says they're passionate about rebuilding their country.

MARCELIN: (Through interpreter) All this work you are looking at now, the calculation was made by Haitian people, Haitian engineers, Haitian architects, Haitian foreman. We know what to do.

SULLIVAN: The Red Cross does not seem to have used that strategy. One manager emailed supervisors in Washington complaining that Haitians were not being hired for top positions and in some cases, were treated disparagingly. Current and former employees told us the Red Cross relied on foreigners who often couldn't speak either French or Creole. Monthly memos warned of gaps in staffing, high turnover and long HR delays, especially with the charity's efforts to fight cholera. That was in the critical early weeks while thousands of people died. The head of the Haiti Program summed up her thoughts in an email in 2011. To maintain the status quo, she wrote, will only yield the same failed results. David Meltzer says the charity did not fail.

MELTZER: When I look at where Haiti is today, I feel very good about the progress that we have made as the American Red Cross and the entire humanitarian sector.

SULLIVAN: These days, the American Red Cross is preparing to leave Haiti. It's handing over operations to the Haitian Red Cross next year. It's also getting ready to leave the hills of Campeche.

Up this hill - OK.

When we dropped in again before we left, residents were still holding on to the Red Cross promotional brochure we gave them. In its pages, they can see that their hope for a brand-new neighborhood of new homes and new lives will not come to be, that this neighborhood project is not finally winding up as they thought but is, in fact, winding down. And they do not understand how it will have cost $24 million. Jean Jean Flaubert stops in front of the wall with the Red Cross logo. He, like many Haitians, now five years after the earthquake, says he doesn't know where all the money could have gone.

FLAUBERT: (Speaking foreign language).

SULLIVAN: He says the Red Cross told them they would change their neighborhood completely. Now, he says, I do not understand what kind of change they're talking about. Laura Sullivan, NPR News.

BLOCK: And you can see some of the Red Cross's internal documents and emails from the story on our website and on

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