Tag: charity

BEE charities: Segregation is back

Charities could face ruin over a government proposal that firms could lose black economic empowerment (BEE) points if they donate to charities that do not have 100 percent black beneficiaries.

Some charities believe the proposal means that any firm that donates to a charity that helps a white, coloured or Indian person may not be able to claim points for its BEE scorecard.

It could also mean that if just one white child or person is among a group of black people the charity is helping, the firm that donates to it could lose it points.

A BEE scorecard is used by the government to measure a company’s BEE compliance. Those that comply do business more easily with other companies also wanting to increase their scorecard and are favoured by the government in all aspects relating to business.

Despite repeated attempts since Monday for a response and clarity from the Department of Trade and Industry, all it would say was: “All stakeholders who have concerns and objections are requested to make use of the 60-day period to make their submission… We will not be in a position to comment/respond to the questions as we do not want to pre-empt the process.”

The amended changes to the BEE Codes of Good Practice are on the department’s website and up for public comment until December 2.

Legislation that is in place allows for charities to assist all races, but lower points are scored when companies assist organisations where less than 75 percent of the recipients are black.

Bridget Brun, a Durban BEE agency head, said she hoped the proposed amendment was an error.

“I don’t think they [the department] have realised what they have done. Think of organisations such as Girls’ and Boys’ Town or Childline,” she said.

“This amendment will have a huge effect. It means if the charity benefits any Indian, white, coloured or even a Mozambican or Zimbabwean child, companies will not be able to claim points on their BEE scorecard. We are now going to have segregated facilities.

“Charities will not help white children if the companies which support them withdraw support because they can’t claim the points.”

Erika Petersen-Holmes, a partner in the commercial and corporate law department at Shepstone and Wylie in Durban, agreed, saying: “Almost all charities have at least one white beneficiary.

“This could result in those charities receiving no corporate donor funding, or those charities rejecting white beneficiaries.”

Karen Hatton-Jones, of retail giant Spar, which gives many charities, orphanages and NGOs large cash and food donations every year, said she was “distressed and disgusted” by the proposed change.

“It’s not going to change what we do. Since when do we put a colour to those in need?” she asked.

Childline head Joan van Niekerk said BEE laws were going from difficult to ridiculous.

“We don’t know the race of the child who phones us. It’s inappropriate to ask, ‘Are you black, and how black are you?’ This is a different kind of apartheid. It’s extremely distressing,” she said.

Van Niekerk said charities were pragmatic about funding.

“There is no such thing as a free lunch. We have to be practical and realistic about funding now. This corporate social responsibility money is something companies are obligated to give and we know the rules up front. If this goes through it will now be far more difficult to deal with.”

Jackie Branfield, of child crisis organisation BobbiBear, said it was the first that she had heard of it.

“Yes, 99 percent of the children we help are black, but we are certainly not going to turn away that 1 percent who could be a white or Indian child. Where’s our democracy, where is our new South Africa?”

Durban Chamber of Commerce CEO Andrew Layman said worthwhile social upliftment projects would suffer. “The implications could be severe,” he said. IOL

A rapper’s charity

A rapper's tears

Wyclef Jean, the Haitian-born hip-hop celebrity, complained when he faced questions about his charity’s financial record and ability to handle what eventually amounted to $16 million in donations.

Portraying himself as persecuted like Jesus and Martin Luther King Jr., Mr. Jean, 40, writes with indignation about insinuations that he had used his charity, Yéle, for personal gain. He says he did not need to — “I have a watch collection worth $500,000”— and that doubters will someday understand “Yéle is Haiti’s greatest asset and ally.”

But on his book tour for “Purpose: An Immigrant’s Story,” Jean neglects to mention two key facts: a continuing New York attorney general’s investigation has already found financial improprieties at Yéle, and the charity effectively went out of business last month, leaving a trail of debts, unfinished projects and broken promises.

“If I had depended on Yéle,” said Diaoly Estimé, whose orphanage features a wall painting of Mr. Jean and his wife, “these kids would all be dead by now.”

Even as Yéle is besieged by angry creditors, an examination of the charity indicates that millions in donations for earthquake victims went to its own offices, salaries, consultants’ fees and travel, to Mr. Jean’s brother-in-law for projects never realized, to materials for temporary houses never built and to accountants dealing with its legal troubles.

On the ground in Haiti, little lasting trace of Yéle’s presence can be discerned. The walled country estate leased for its headquarters, on which the charity lavished $600,000, is deserted. Yéle’s street cleaning crews have been disbanded. The Yéle-branded tents and tarps have mostly disintegrated; one camp leader said they had not seen Yéle, which is based in New York, since Jean was disqualified as a presidential candidate because he lives in Saddle River, N.J., not Haiti.

This summer, the charity foundered.

At the end of August, Derek Q. Johnson, Yéle’s chief executive, announced his resignation to supporters.

His resignation came after Jean declined to accept a settlement proposed by the attorney general covering the charity’s pre-earthquake activities, and he hired Avi Schick, a lawyer who had been a member of Attorney General Eric T. Schneiderman’s transition team.

The settlement would have required Jean and the two other Yéle founders to pay $600,000 in restitution “to remedy the waste of the foundation’s assets.” It also would have required Yéle to pay for a forensic audit of its post-disaster expenses, as it had done for its pre-earthquake finances, and to start “winding down its affairs.”

In 2010, Yéle spent $9 million and half went to travel, to salaries and consultants’ fees and to expenses related to their offices and warehouse. In contrast, another celebrity charity, Sean Penn’s J/P Haitian Relief Organization, spent $13 million with only 10 percent going to those costs.

Though Mr. Penn’s group spent $43,000 on office-related expenses, Yéle spent $1.4 million, including $375,000 for “landscaping” and $37,000 for rent to Mr. Jean’s Manhattan recording studio. Yéle spent $470,440 on its own food and beverages.

Some of Yéle’s programming money went to projects that never came to fruition: temporary homes for which it prepaid $93,000; a medical center to have been housed in geodesic domes for which it paid $146,000; the revitalization of a plaza in the Cité Soleil slum, where supposed improvements that cost $230,000 are nowhere to be seen.

In its relief operation, Yéle operated outside the coordination system set up by other nongovernment groups; it did not want to be burdened by rules and meetings, Mr. Locke said in a 2010 interview.

Other organizations focused on providing concrete services like sanitation or health care.

Yéle chose to work more broadly than deeply. It supplied food, water and supplies to what it said were dozens of tent camps. Julie Schindall, then spokeswoman for Oxfam America, called it a “dump and run strategy.” Mr. Penn told The New York Times in 2010, “My impression is that Yéle is at the service of Wyclef Jean and his reputation.”