Red Cross Received $500 Million in Haitian Relief Money, But Only Built 6 Houses

Haiti Relief Raised $500,000 to built 6 houses
The Red Cross promised to build hundreds of new homes in Campeche but none have been built. Many residents still live in crude shacks. (Marie Arago, special to ProPublica)

Red Cross raised half a billion dollars for Haiti, but  built only six homes in return. That’s just over $83.3 million a house, according to calculations.

To be fair, the money that was funneled into Haiti in the wake of the devastating 2010 earthquake wasn’t divvied up so neatly. That’s the big takeaway from ProPublica’s latest Red Cross investigation, which explores how the international charity grossly mismanaged its response to one of the worst natural disasters in the history of the Western Hemisphere.

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Over the last year, the investigative nonprofit has published multiple scathing critiques targeting the Red Cross, including stories about distrust among the charity’s workforce and a highly critical look at its response to Hurricane Sandy.

But the latest story in the series, reported in conjunction with NPR, may be the most damning yet due to revelations like this:

The Red Cross says it has provided homes to more than 130,000 people. But the actual number of permanent homes the group has built in all of Haiti: SIX.

After the earthquake, Red Cross CEO Gail McGovern unveiled ambitious plans to “develop brand-new communities.” None has ever been built.

So what went wrong?

The report hones in on a major blunder that hindered the charity’s work in Haiti and led to mismanaged funds early on: “An over-reliance on foreigners who could not speak French or Creole.”

ProPublica reported that, despite an effort to hire locals, few Haitians have reached leadership positions within the Red Cross, hampering projects and costing the organization more money.

“Lacking the expertise to mount its own projects, the Red Cross ended up giving much of the money to other groups to do the work,” according to ProPublica. “Those groups took out a piece of every dollar to cover overhead and management. Even on the projects done by others, the Red Cross had its own significant expenses – in one case, adding up to a third of the project’s budget.”

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A congressional staffer who helped oversee Haiti reconstruction told ProPublica. “They collected nearly half a billion dollars. But they had a problem. And the problem was that they had absolutely no expertise.”

In promotional materials cited by ProPublica, the Red Cross claims it has helped “more than 4.5 million” Haitians “get back on their feet.”

To bolster this claim, ProPublica notes, the charity cites such projects as “repairing 4,000 homes, giving several thousand families temporary shelters, donating $44 million for food after the earthquake, and helping fund the construction of a hospital.”

Even so, Jean-Max Bellerive, Haiti’s prime minister at the time of the earthquake, has his doubts.

“Five hundred million dollars in Haiti is a lot of money,” he told ProPublica. “I’m not a big mathematician, but I can make some additions. I know more or less the cost of things. Unless you don’t pay for the gasoline the same price I was paying, unless you pay people 20 times what I was paying them, unless the cost of the house you built was five times the cost I was paying, it doesn’t add up for me.”

Read the entire investigation here.

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