Can Ireland’s biggest humanitarian agency beat a corruption scandal?

Ben Parker

Senior Editor

Contact: WhatsApp/Signal/SMS: +44 7808 791 267

Scandal-hit Irish NGO GOAL has begun layoffs as it faces a budget crisis and is, by the admission of its own board’s chairperson, entering a “critical period”. Aid industry insiders wonder if it will survive.

GOAL’s chief operating officer and CEO have both resigned, following investigations into graft in cross-border aid from Turkey into Syria. The first public casualty of the downsizing is GOAL’s US branch, to be shut down with the loss of 10 jobs. GOAL declined to comment on rumours of further job losses and the extent of its financial difficulties.

A new general manager, Celine Fitzgerald, took over on 1 November. Fitzgerald, a “change management expert”, according to a statement from GOAL, is tasked with managing a “transition” and strengthening governance and risk management. As IRIN reported in May, a probe by USAID’s inspector general found that Turkish suppliers “colluded with corrupt procurement staff within several of USAID’s implementers”. So far, 18 individuals and suppliers in Turkey have been named in US proceedings as well as three NGOs: GOAL, the International Rescue Committee, and International Medical Corps.

While the other NGOs are feeling due pressure from the US probe, GOAL may face “catastrophic downsizing”, a well-placed source inside the Irish NGO claimed. According to the individual, who requested anonymity, the impact is greater because senior management and GOAL’s board failed to tackle underlying issues.

A presentation from Noble House, a company set up by GOAL employees
In a 2014 sales PowerPoint, Noble House shows images of aid vouchers for Syria labelled "aid from the people of Ireland"

“If this was a football club, the whole lot would have been fired months ago,” the source said.

GOAL board chairperson Anne O’Leary acknowledged the scale of the problem in a statement emailed to IRIN: “The next 12 months will be a critical period for GOAL as we seek to regain and consolidate the trust of our donors and the general public, while continuing with the implementation of our aid programmes across the world.”

Conflict of interest

GOAL faces a higher cost from the investigation than other NGOs involved because of its handling of a conflict of interest between the charity and closely-linked contractors, the well-placed source told IRIN. In a series of damaging revelations, Irish media have exposed that the NGO had business dealings with a commercial logistics firm established in 2013 by GOAL’s own employees, including its chief operating officer. Complicating matters further, the major shareholder in the venture had a twin brother who was a trustee of GOAL’s UK charity.

The firm, Noble House Business PLC (now renamed Pinnacle Business PLC), was set up to service aid agencies in Turkey and elsewhere just as international cross-border funding for Syria peaked. Demand was growing and major aid groups had to step up their operations quickly. Noble House’s clients included a UN agency, which spent a total of $663,756 with the firm in 2014 and 2015. UN agencies, unlike most NGOs, are obliged to release contracting information. For that reason, the main sources of Noble House’s 2013-2015 business remain unknown. IRIN has gathered available information from company records mentioned in media reports into the graphic below (which serves to demonstrate the tangled interlocking relationships: no wrongdoing is alleged). 

GOAL contracted Noble House to the tune of a relatively modest €90,000 ($114,200) in 2015, according to responses given to the Irish newspaper, Mail on Sunday. Noble House’s accounts show a mixed picture: a multi-million dollar turnover in 2013-14, but an operating loss in 2015 of $400,000. Altogether, details remain sketchy: GOAL has provided few details of what business dealings it had with Noble House, nor of the scope of the USAID investigation in general. GOAL’s board has not released details of an internal investigation commissioned from accountants BDO.  

A senior figure connected to the Noble House affair, Jonathan Edgar, did resign as GOAL’s chief operation officer in recent weeks, according to the Irish Times. GOAL's CEO Barry Andrews has also departed. Andrew Godson, brother of Noble House shareholder Jonathan Godson, also ended his trusteeship at the UK charitable wing of GOAL in early September.

The US, the UK, Ireland, and the EU together represent 77 percent of GOAL’s income in 2014. GOAL is dependent on this handful of donors and a slump in confidence could lead to a critical collapse in donor support: “If anything goes wrong, it’s a domino effect,” an NGO analyst told IRIN.

Growing pains

A July 2014 UN Security Council resolution explicitly allowed the UN to deliver aid across Syria’s international borders, but many NGOs were doing so earlier. As the Syrian civil war worsened, the US and other donors started to ramp up humanitarian relief operations from Turkey into opposition-controlled areas of Syria.

The rapid scale-up took place in a secretive atmosphere due to security concerns and a desire to keep a low profile both in Turkey and Syria. The operational set-up, involving high-volume procurement and trucking across the border into a complex war zone was fraught with challenges, which were often poorly handled, managers familiar with those operations told IRIN.

GOAL almost quadrupled its income – from about €60 million in 2011 to €210 million in 2015, mainly thanks to a series of large grants from USAID for Syria. Despite the investigation, funds are still being disbursed to the charity from the US, based on existing grant agreements.
 

 
In an interview on Irish media this year, former CEO Barry Andrews acknowledged that the organisation had grown too fast, and in a farewell message to supporters he wrote: “The circumstances of the OIG investigation over the last 7 months has been extremely uncomfortable for GOAL and we are working hard on correcting the weaknesses identified and providing all necessary assurances to our donors.”
 

Lifeline?

Whether there is a lifeline for GOAL from the Irish government will be a “critical indicator” of its chances, according to the NGO analyst, who requested anonymity. In the next few weeks, Irish Aid will announce a round of multi-year funding decisions, known as programme grants. Without this injection of state funding, GOAL’s cash problems will remain acute, observers say. More than €10 million of Irish Aid funds are already being withheld, pending the outcome of the USAID investigation.

"GOAL’s income has not entirely dried up."

GOAL’s income has not entirely dried up, however. GOAL has received $37 million in humanitarian funding from the EC, the US, Ireland, and Germany in 2016, according to the UN’s financial tracking system, along with grants from UN-managed pooled funds.

GOAL employs some 3,000 people around the world – local and international staff. The failure by GOAL’s management and its board to tackle the graft issue, and their attempt instead to “spin their way out of trouble” puts those jobs on the line, the insider source said.

(TOP PHOTO: A shop in northern Syria that participates in GOAL's food voucher scheme. Photo: GOAL)

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