Wyclef Jean caught in Haiti charity controversy

One of the most high-profile Haitian-born Americans, the hip-hop artist Wyclef Jean, has had to defend the payment of funds raised by his Yele Haiti charitable foundation to companies he himself owns. He admitted that payments had been made to cover the production costs of benefit concerts, but insisted he had not personally gained.

"Did I ever use Yele money for personal benefits? Absolutely not," Jean told a press conference in New York yesterday. "Yele's books are open and transparent, and we have a clean bill of health by an external auditor every year since we started."

Jean was tearful as he defended his foundation and spoke of the suffering in Haiti. "I do not cry for myself, I cry for them," he said.

The accusations stem from the posting of Yele Haiti's 2006 tax return on the The Smoking Gun website last week.

It showed that out of the $1m raised from donors that year, Yele paid $250,000 in TV television production fees to Telemax, a company that Jean owns with fellow Yele board member Jerry Duplessis.

Another $31,000 was paid to Platinum Sound, a Manhattan-based company also owned by Wyclef and Duplessis. And a further $100,000 was paid to Wyclef himself, apparently to cover his costs of performing at a benefit concert in Monte Carlo, Monaco. The Smoking Gun asked "why Jean needed to be paid to perform at his own charity's fundraiser".

Jean claims they were all legitimate production costs and tax experts have agreed that it is routine for people in Jean's position to charge their own charities, so long as services are being provided in return. "The tax rules do not prohibit related party transactions," said Marcus Owen, former chief of the IRS unit that oversees non-profit groups.

However, Hugh Locke, president of Yele Haiti, has admitted the foundation was too closely intertwined with Jean's businesses and promised there will be no payments of this kind in the future.

The controversy has arisen just as Yele Haiti has managed to raise $1.5m for the earthquake victims from Americans donating $5 through text messages. Wyclef Jean promised yesterday that their money will be spent on saving lives.

However, many continue to be puzzled by the transactions revealed on The Smoking Gun and there are worries this will dampen Americans' enthusiasm to donate to the Haiti cause.

Jean is due to co-host with actor George Clooney this Friday's 'Hope for Haiti' telethon. Bono, Justin Timberlake, Alicia Keys, Sting and Christina Aguilera are among the acts booked.

However, Jean, who was born in Croix-des-Bouquets, a northern suburb of Port-au-Prince, has given no indication he might step aside from his role in the telethon and used his press conference to call for a full evacuation of the devastated Haitian capital.

"We need a massive exodus outside of Port-au-Prince," he said. "We need to migrate at least two million people," adding: "I give you my word, if I tell them to go, they will go." ·