Wyclef Jean’s Yele Haiti Foundation under fiscal scrutiny

Washington Post Staff Writer
Saturday, January 16, 2010

By Friday morning, just days after the earthquake hit, Wyclef Jean’s Yele Haiti Foundation had raised more than $1.5 million.

Undoubtedly, Jean’s celebrity helped draw in donors: He’s an internationally known musician from Haiti who won a Grammy with the Fugees and went on to a hugely successful solo career. But an analysis of the charity’s tax returns raises questions about how it has spent money in the past, with administrative expenses that appear to be higher than comparable charities and payments to businesses owned by the musician and a board member, including $100,000 for a performance by Jean at a 2006 benefit concert.

“It seems clear that a significant amount of the monies that this charity raises go for costs other than providing benefits to Haitians in need,” said Dean Zerbe, national managing director of Alliant Group, a tax services company, and the former tax counsel to the Senate Finance Committee, which oversees charities.

Jean responded to the criticisms Saturday evening via YouTube. In the six-and-a-half-minute clip he says that he has “always been committed to the people of Haiti, I live in that country, I’m Haitian. This is where I come from.”

The concerns were first reported on The Smoking Gun Web site.

“It brings real caution for donors that want to help in Haiti that they might want to take a harder look at this organization but also consider the significant number of charities that have been doing good work in Haiti that don’t have these question marks,” Zerbe said.

Hugh Locke, president of Yele Haiti, said the charity does what others can’t, because Jean gives it unusual access to the country’s slums. He said the group hopes to spend a higher percentage of its budget on services as it gains experience. “I think people should be very comfortable that any money given to Yele Haiti is going 100 percent to emergency relief.”

The earthquake prompted so much donor interest in Yele Haiti that its Web site crashed Thursday. Yele Haiti also is getting much publicity at events, including a fundraiser Monday at the 9:30 Club and a telethon next Friday hosted by actor George Clooney. It is collecting supplies Sunday in Miami and airlifting them to Port-au-Prince next week, Locke said.

The charity provides scholarships, funds a soccer team, takes students on environmental-education camping trips and employs women to cook for schools, according to Yele Haiti. After a 2008 storm, it helped a food program distribute emergency rations to 6,000 families without violence, Locke said, organizing the community to distribute the food rather than sending in aid workers with armed guards.

But its financial records raise questions, experts say. In 2006, Yele Haiti had about $1 million in revenue, according to tax documents. More than a third of the money went to payments to related parties, said lawyer James Joseph, who specializes in nonprofit issues.

“It might be completely legitimate. But it’s certainly something I would want to look into more carefully,” Joseph said.

For instance, the charity recorded a payment of $250,000 to Telemax, a TV station and production company in Haiti in which Jean and Jerry Duplessis, both members of Yele Haiti’s board of directors, had a controlling interest. The charity paid about $31,000 in rent to Platinum Sound, a Manhattan recording studio owned by Jean and Duplessis. And it spent an additional $100,000 for Jean’s performance at a benefit concert in Monaco. Locke said that Jean and Duplessis were unavailable for comment Friday.

The Telemax money was used for “everything from public-service announcements to educational programming,” said Jesse Derris of the public relations firm Sunshine, Sachs and Associates, which is representing Yele Haiti. They used their own company “because it was a way to buy time at a significant discount.”

The rent included office space and shared receptionist services for the charity and is “severely reduced” below market rate, Derris said. All the proceeds of the benefit concert went directly to Yele Haiti, he said. Locke said the $100,000 included expenses, such as payments to backup musicians and production costs.

Yele Haiti reported nearly $1.9 million in income on its 2008 tax return.

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4 thoughts on “Wyclef Jean’s Yele Haiti Foundation under fiscal scrutiny

  1. Wyclef is a great personality and a great musician.

    Wyclef is a great promoter of Haiti

    But Wyclef is a jerk!!

    He makes enough money elsewhere. He should not touch a penny in his charity…period!!! The funds there should remain untouched, only for use in Haiti.

    He obviously hasn’t learned a thing since being jerked up for not filing his charity’s tax reports for several years. He was criticized for sending donated funds directly to Haiti, without passing them through the charity….effectively neutralizing the tax exemption to the donors.

    People get sick and tired of entertainers DONATING their time…only to reveal later that THEY WERE PAID LARGE SUMS FOR THEIR PERFORMANCE!!!

    I thought Wyclef was different.

    Hoped his manager Hugh Locke was in control.

    Guess I was wrong.

  2. Wyclef includes his girlfriend on the payroll for big bucks.

    Like Tiger Woods, he cannot keep his pants zipped.

    Charity records are public records and Wyclef’s wife is not a stupid lady.

    Wyclef had a big problem in Haiti, first time around, with the Mob. There was a conference and the money was not accounted for. The Mob thought Wyclef had taken it. His manager in Haiti managed to point the finger at another person.

    Now, we must wonder.

  3. Wyclef is earning tons of money as a musician.

    If he had a clue, he would not take a penny out of his charity, not even for office expenses. A dollar in would be a dollar to the charity’s projects.

    Now he collects a million and pays himself $100,000 for a music show and a couple of hundred thousand for his girlfriends…to do what???

    Not too smart in a world where your image can be tarnished so easily.

    The present situation makes on wonder about the earlier rumours written above.

    Smoke….fire????

  4. It sounds like temptation got the best of him. Now, he should fix it and spend a few MILLION dollars on getting housing for his countrymen.

    NOW!!!!!!

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