It is not the first time that ICT and especially Internet-based communication tools are being used to raise funds for work which is not at all what it appears. Yahoo groups, facebook, skype etc. are handy networking tools, but they do not require anybody to actually have met in person, nor allow you to verify the true identity and the true nature of what is going on, since such tools are used for making and maintaining contact with people on the other side of the globe.
In 1999-2001, the finance world of venture capital was shaken by the so-called "IT-bubble". During this time, there was such a frenzy among many venture capitalists to capitalize on any business idea involving the Internet that massive amounts of money were pumped into projects on the single basis that they involved some kind of e-commerce. It was examples such as Yahoo, Google and Ebay which stock value skyrocketed that set off the gold-digging. In hindsight, many established institutions found themselves having put up millions in order to finance the hobby of opportunistic Internet-users. Aggressive marketing strategies were to boost the company's share value in view of an IPO. The truth is that most of these firms never made break-even, but instead were burdened by extreme burn rates and concepts which held little novelty other than that they promised a way of making business on the Internet. The story of Boo.com in London, backed by JP Morgan, is illustrative of what was going on and how great the fall was to be once the bubble burst.
Still, these ventures were not illegal, and one might hope that the world would be wiser from the experience.
For some time, people in Africa and Eastern Europe have been using spam mails as a way to solicit money from individuals based on some personal story of need or a phony business proposition. By now, most people on the Internet are aware of such frauds, often referred to as "Nigeria letters". But what we do not seem to realize is that there are people who are taking such simple scams to a much higher level.
What makes the OVF (OneVillage Foundation) case so serious, is that it illustrates how a small network of people are able to use Internet tools in order to create the illusion that they are into charity work in remote places where they expect few to be connected and thus able to verify their story.
The OVF network has its roots in the green movement and the followers of Doug Engelbart who claim that technology - and especially ICT - will save the world. Hence the intense promotion of ICT4D, meaning information and communication technologies for development. Ten years ago, the Internet bubble was made possible through the wideheld assumption that venture capital was a panacea for business development and that growth (meaning market share) was an end in itself, not a means to reach an end. This is a strong-held tenet amongst many influential actors in politics, education and business in line with Ayn Rand's philosophy that seeks to promote and establish the blind pursuit of profits as moral superiority. The kind of international fraud represented by OVF is made possible by similar assumptions - i.e. the belief that technology is a panacea that will guarantee the welfare and happiness of people in poor countries through "development". The fact that this often is a disguise for ICT companies to find new markets for their products and has little to do with what people suffering from starvation, malnutrition or treatable diseases like malaria actually need is seldom - if ever - brought to our attention. Furthermore, the OVF promotes the concept of a "collective IQ" in order to encourage other people to give freely of their own time, ideas, contacts and resources - all of which will be appropriated and taken credit for by the OVF people themselves. However, the ideas and resources that are retained by the OVF are not applied to charity, as they claim, but are put to the benefit of the OVF people.
How can it be so easy for a small network to operate a fraud within the international aid community? The past decade has seen the domain of philanthropy undergo important changes, blurring the boundaries between non-profit and profit i.e. business activities. The main driving forces underlying this transition are on the one hand, the relative importance of what is called the "aid industry" in terms of the size of money that is being allocated (much of which is consumed as overhead for maintaining large, fundraising institutions). Microfinance and microcredit mechanisms have stimulated this trend by providing a means of lending rather than giving away money that is earmarked for charity, thus enabling NGOs to operate as banking institutions. On the other hand, CSR has become an important strategic tool for corporations to gain goodwill, and position themselves on emerging markets - the focus now being on Africa as the one remaining "dark continent" (meaning unexploited) once markets in the Western world and Asia are saturated. Just as with the ICT-venture capital phenomenon, the submission of project proposals for funding is being strongly encouraged, because there is much more money on the lookout for a "development outlet" than there are good and solid development projects to be found.
An international fraud like OVF can only operate as long as they make people believe in their illusion. It does not take much scratching beneath the surface to see through the scam, though. The purpose of this blog is to raise those questions which will uncover the true nature of their operations, and make the truth known. May the OVF case serve as a warning for anyone looking to exploit the good intentions of others and the vulnerability of people in the poor part of the world for their own greed.
More about how OVF operates its fraud can be find on the About the OneVillage Foundation page.
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