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Ford Announces New Funding Guidelines As It Admits to Aiding Anti-israel Groups

November 19, 2003
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In a stunning reversal, the Ford Foundation has admitted it erred in funding anti-Israeli Palestinian groups and has vowed to establish tough new guidelines to stop its funds from being used for anti-Semitic activities anywhere in the world.

The group said it was “disgusted” by anti-Israel and anti-Semitic agitation action taken at the 2001 U.N. Conference Against Racism at Durban, South Africa, which the foundation helped finance.

In addition to establishing new funding guidelines, the foundation’s letter said the group promises to cease financing of pivotal anti-Israel groups and even recover funds where the grant’s intent was violated.

Ford’s wide-ranging announcement was detailed in a five-page, single-spaced letter to Nadler. Nadler had circulated a petition signed by 20 members of Congress demanding that Ford halt its funding of anti-Israel hate groups.

Nadler’s petition and Ford’s letter came in the wake of a four-part JTA investigative series, “Funding Hate,” which documented how Ford grantees were using the prestigious foundation’s money to foment virulent anti-Israel and anti-Semitic agitation in the Middle East and worldwide — and in some cases advocacy for armed revolution in Israel.

There were also indications from the IRS, State Department and Justice Department that officials would review Ford’s funding.

In her letter to Nadler, Berresford wrote, “Recent media stories have raised questions about the conduct of certain Palestinian grantees who participated in the 2001 U.N. World Conference Against Racism in Durban, and the adequacy of the Foundation’s oversight of grantees. In response, Foundation officers and trustees have discussed these stories with concerned individuals, making clear the numerous steps that the Foundation takes to ensure the proper use of its funds.”

“Having reassessed our own information on the Durban Conference,” the letter said, “and in continuing talks with others, we now recognize that we did not have a complete picture of the activities, organizations and people involved. Although some Ford-supported grantee organizations repudiated the bigotry they witnessed in Durban, questions remain about others. More troubling still is the fact that many organizations among the large number at the conference did not respond at all.”

“We deeply regret that Foundation grantees may have taken part in unacceptable behavior in Durban,” the Durban section of the letter concluded.

Nadler and representatives of Jewish groups with whom Ford officials had met after publication of the JTA series praised Ford’s response.

But Berresford promised more than just apologies. She pledged to take sweeping new preventive and monitoring measures to address revelations in the JTA investigation that Ford grantees were openly refusing to sign U.S. government funding guidelines designed to ensure that charitable donations in the Middle East don’t end up in terrorist hands.

Those guidelines are known as the USAID’s Certification Regarding Terrorist Funding.

In a section of Berresford’s letter titled, “Prevention of Funding for Terrorism,” the Ford Foundation said it regularly checks approximately 4,000 active grantees against a State Department list to identify any that might be on the State Department’s proscribed list.

“To date we have found no matches,” the letter said.

But, the letter continued, new measures will help ensure that funds will not be passed through one organization to another, or that Ford grantees use other independent monies to promote violence or terrorism.

In addition, Berresford said, Ford will require additional measures “to make explicit our intolerance for unacceptable activity by any grantee organization.”

She said that Ford’s standard grant-agreement letter, which grantees worldwide must sign to receive Ford funds, “will now include explicit language requiring the organization to agree that it will not promote violence or terrorism. This prohibition applies to all of the organization’s funds, not just those provided through a grant from the Ford Foundation. Organizations unwilling to agree to these terms will not receive Foundation support.”

The Berresford letter also contained a section titled, “Prevention of Funding for Bigotry and the Destruction of any State,” which declared that organizations promoting the delegitimization or destruction of Israel would be ineligible for funding.

“Grantees refusing to sign this agreement will not receive Foundation support,” the letter said. “We will never support groups that promote or condone bigotry or violence, or that challenge the very existence of legitimate, sovereign states like Israel.”

Addressing questions raised in the JTA series about monitoring of funds to grantees, the Berresford letter included a section titled “Financial Oversight,” in which Ford announced a major new auditing initiative.

“Ford will now reinforce its oversight with a new and expanded worldwide program of grantee audits. The Foundation has engaged the international accounting firm KPMG to create a risk matrix that Ford will use to determine which grantees it will audit in the new augmented oversight program.”

The new system will go into effect within weeks.

“KPMG will develop and fully test this new oversight effort in our Middle East office, starting in early December,” Berresford wrote, saying it ultimately would extend it to its other offices worldwide.

Berresford’s letter also said that Ford is willing to commission a special organizational audit and if “concerns remain” will “recover funds, if that is appropriate.”

The new auditing system could impact donors everywhere.

“Because the new methodology may be useful to other philanthropic donors, we will make it available to other donors who request it,” the Berresford letter stated.

Meanwhile, in a special section specifically addressing the Durban conference, the Berresford letter completely reversed the earlier position of its vice president, Alexander Wilde.

In statements and letters to the editor, Wilde had insisted, “We do not believe” that the events at Durban “can be described as ‘agitation.’ “

In her letter, Berresford said, “Ford trustees, officers and staff were disgusted by the vicious anti-Semitic activity seen at Durban, and we were disappointed that it undermined the vital issues on the meeting’s agenda.”

“The Foundation has reviewed its own information to establish whether Ford grantees took part in unacceptable, ugly and provocative behavior,” she added.

“To ensure that we receive a complete picture of grantees involved in the Durban conference, Foundation officers and outside advisors will seek out attendees whom we, American Jewish leaders and others concerned about anti-Semitism and hate speech think should be heard on these matters.”

Promising action, Berresford’s letter said, “If the Foundation finds allegations of bigotry and incitement of hatred by particular grantees to be true, in conformance with normal Foundation policy, we will cease funding.”

In that vein, Berresford’s letter announced that the Foundation “has decided to cease funding LAW, a grantee that has been the subject of criticism.”

LAW, whose full name is the Palestinian Committee for the Protection of Human Rights and the Environment, was a special focus of the JTA series. The group was a principal player in the anti-Israel agitation in Durban. An audit concluded it misappropriated millions in philanthropic funds.

“LAW had over 30 donors in all, including European and Scandinavian governments, and an audit commissioned by Ford and other donors revealed that it had misused funds,” Berresford said.

The Ford Foundation president also said that Ford is disturbed by the conduct of LAW’s past leadership at the Durban conference.

Although a newly constituted board and executive leadership have made the organization smaller and more focused, she said, LAW has “not taken adequate steps to demonstrate financial control to warrant continued support.”

Berresford’s letter ended by acknowledging the “new Anti-Semitism” — which has been the subject of numerous magazines articles and a newly released book by Abraham Foxman, the national director of the Anti-Defamation League, called”Never Again.”

On Monday, Berresford had an hour-long meeting in her office with Foxman, who has been active in the effort to address Ford’s funding. It was one of several meetings Berresford had with Jewish organizational leaders since the publication of the JTA series.

The Berresford letter said the “process will also help deepen the Foundation’s knowledge of the ‘new anti-Semitism’ around the world and yield lessons about measures that we and others can take to avoid repetition of the negative dynamics of Durban.”

Berresford added, “Ford shares the concern of many about the alarming rise of anti-Semitism around the world and is committed to addressing this disturbing trend. Leaders of American Jewish organizations and others with whom we have consulted urged the Foundation to further explore ways to respond, and Ford welcomes the opportunity to do so.”

Nadler, who released the Ford letter Tuesday, praised Ford’s response to the revelations, saying the foundation’s “leadership outlines a set of important and concrete steps they are voluntarily taking to strengthen oversight of grantees and to utilize the Foundation’s considerable international reach and standing to assist in combating global anti-Semitism.”

Nadler said it is “highly commendable” that the organization “is willing to take serious and transparent steps to admit and correct past wrongs and to create mechanisms to prevent bigoted or violent groups from becoming beneficiaries of the Ford Foundation’s goodwill in the future.”

He also said he has made it clear to Ford Foundation officials that they must follow through with their commitments. “As we know, actions, not words, will be what count in the end,” Nadler said.

For her part, Berresford, through a spokesman, told JTA on Tuesday, “We appreciate the congressman’s leadership in working with us to resolve these issues and in helping us to reach out to those who have expressed concerns. We believe these actions are clear steps toward building common ground and a common understanding.” Jewish community leaders applauded Ford’s dramatic turnabout.

Malcolm Hoenlein, executive vice chairman of the Conference of Presidents of Major American Jewish Organizations, said, “We welcome the statement by Ford that they will stop funding groups that have been promoting hatred of Israel and the delegitimization of Israel. We look forward to seeing these changes implemented and hope that other foundations that may have engaged in similar conduct will also make the necessary corrections.”

Foxman said he welcomed the “the sincere effort by the current leadership of the Ford Foundation to deal responsibly with the past and to put into place safeguards so that these things do not recur.”

Foxman also spoke of a new long-term relationship to “not only implement the new guidelines but to help them develop programs which will serve the welfare of people of goodwill who sincerely want to better the world.”

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