USAID Review of Health NGO Finds Litany of Irregularities

A financial review by USAID, the U.S. government’s development arm, into local health NGO Reproductive and Child Health Alliance (RACHA) has found financial mismanagement coupled with a lack of transparency and oversight within the organization that may point to evidence of fraudulent activity. Well-known for its collaboration with the Ministry of Health and the Ministry of Women’s Affairs, and other development partners, RACHA operates across eight provinces in projects relating to family planning and reducing maternal deaths, as well as newborn and child health. USAID is RACHA’s primary donor, and has provided about 80 percent of the organization’s funding since 2003. The USAID report, which investigated RACHA’s financial management, procurement practices, and organizational structure, concludes based on a cost analysis that a total of $160,438 spent between 2009 and May 2013 was either not properly accounted for or used to buy items with irregularly high prices. … A study of RACHA’s renovation activities at 163 project sites in Prey Veng, Koh Kong, Pursat, Siem Reap and Banteay Meanchey provinces, which cost $3,968,015, found that only RACHA’s senior management were fully involved in procurement practices, and only a handful of favored contractors were informed of the bidding process—hampering free and fair competition, and again leaving the NGO vulnerable to fraud. The report also found that poor-quality medical equipment was provided to RACHA’s health centers even though the equipment was purchased from a longtime supplier at a much higher price than it was actually worth.

Simon Henderson and Kuch Naren