An assistance organisation that is based in the United States stated that roughly $900,000 was taken from its programmes in the Congo by personnel of the organisation who colluded with others from outside the organisation.
GiveDirectly has stated that it has learned that members of its Congo team collaborated with individuals from outside the organisation to commit fraud against the cash transfer programme. This crime resulted in the theft of assistance from over 1,700 needy families over the course of six months, beginning in August 2022. According to the statement released on Monday, “This fraud was only possible because of a specific change we made in our payment process in order to work in this remote, insecure region of Congo.” “We feel deep regret for not catching this sooner, and we take seriously the vulnerabilities it exposed.”
GiveDirectly stated that an investigation was still being conducted and that it had been successful in recovering “a very small portion of the lost funds,” but that it anticipated that the majority of the $900,000 would be “uncoverable.” However, the organisation is trying to guarantee that families who have been affected by the fraud get their money as soon as possible. According to GiveDirectly, the amount of money that was stolen or lost due to fraud during the previous year was the largest it has ever been.
This group has been active in the Eastern Congo region for many years. There are over 120 armed factions currently engaged in conflict in the region, the majority of which are vying for control of land and mines containing precious minerals, while other organizations are attempting to safeguard their villages. According to the estimates provided by the United Nations, there are over 5.5 million people who have been forced to leave their homes in the Congo, and over 26 million people are at risk of becoming hungry.
Analysts believe that the protracted crises and the lack of development have created an environment that is fertile ground for unethical practices to flourish within assistance organizations.
“Given the importance that the development sector plays in the economy of the country, it should not come as a surprise that corruption exists within the industry. Benjamin Hunter, an Africa analyst with the risk assessment firm Verisk Maplecroft, stated on Tuesday (June 6) that “it is likely that a sizeable portion of the billions of dollars in development dollars that flow into (Congo) every year is lost to corruption.”
GiveDirectly is a global provider of cash transfers, having distributed over $650 million to individuals in over a dozen countries, the majority of which are in Africa. It does this by utilizing mobile money, which is a system that allows users to send and receive money through the use of a SIM card. The company claims that this eliminates many different types of fraud. After the money has been deposited, individuals are able to retrieve the cash at a mobile money station.
In the regular course of events, the organisation registers people with an independent money agent, provides them with SIM cards, and deposits funds on them. However, due to the instability in the South Kivu province of eastern Congo, where it was working, GiveDirectly stated that it made an exception to its standard protocols. The organization decided to deploy its own enrollment team rather than have individuals register with independent mobile agents. Doing so would have frequently required the individuals to travel significant distances.
“We now know that while enrolling villages in South Kivu, some staff conspired to register payment SIMs in the names of the recipients (per the special exception granted), pocket those registered SIMs, and put different SIMs in the recipients’ phones,” the organization claimed. It was reported that GiveDirect had issued cash transfers to the registered SIM cards, many of which had been stolen by the personnel. The staff, with assistance from former employees and outside money agents, had allegedly diverted funds that were intended for those in need.
Give Directly stated that the case was alarming for three reasons: “the scale of the fraud at the expense of people in extreme poverty”; “the number of our own team members who participate”; and “the failure of our systems to prevent it.” The organization stated that it has no reason to think that the scam is not limited to the programmes that take place in eastern Congo.
However, according to an investigation that was conducted by The New Humanitarian, another of the organization’s programmes was being inspected in one of its operations that was located in sub-Saharan Africa. The independent investigations conducted by the Associated Press were unsuccessful. According to GiveDirectly, “full checks have been done on all other countries and programmes and have revealed no other signs of significant fraud.”