Give or Take?

female stealing from male on a date is a fund operated by an organization called Opportunity Finance Network (OFN) which is sponsored by Starbucks.  As I understand it, individuals who visit Starbucks donate money to create this Createjobsforusa Fund in exchange for a wristband. There is a display in every Starbucks and supposedly The Starbucks Foundation donated the first $5MM in seed capital for this fund. The OFN is supposedly a network of banks AKA Community Development Financial Institutions (CDFIs) that allegedly invest in opportunities to benefit low-income, low-wealth and other disadvantaged communities across the spark job growth. Any community bank that meets OFN’s eligibility criteria can apply for and gain membership in this network and the eligibility criteria is prominently displayed along with the membership benefits on the OFN website:

Here’s the kicker: I’ve been all through the OFN website (and even watched their cheesy little video and not only can I not find any information to support their claim that 100% of the donated funds go towards the creation of jobs, but I can’t see where $1 of the donated funds goes towards the creation of jobs. The OFN doesn’t even use the funds to insure the loans that are originated by the member banks like FHA does or guarantee the loans like VA does (or maybe they just left that part out of the member benefits section).

Here’s how the whole operation works as I see it:

  1. People visit Starbucks (literally tens of millions of people worldwide daily) to buy their favorite cup of joe.
  2. The visitors see this nifty way to help out the unemployment situation so they make a donation and get a cloth-covered rubber band to wear on their wrist and placate their conscience (it’s for a good cause, right?).
  3. The funds then go to OFN (the total amount has to be millions daily because they ask for a minimum donation of $5 and I am sure some give more).

As far as I can tell, the donated dollars stop at OFN because even if a community bank applies and gains membership in the “Premiere Network of CDFIs” the bank still lends out its own funds, charges and collects interest, and is responsible for servicing and making sure that the loans are repaid.

I originally dug into this because I was going to throw the flag on the banks if OFN gave the banks the donated funds to make loans with since this would mean that the banks would be earning interest on and getting paid back dollars that were simply given to them. Much to my surprise, however, it appears to be far more egregious than that—OFN apparently just keeps the donated money and offers the member banks some nominal benefits that, in my opinion, are of questionable value such as a discount for attending the annual OFN Conference (supposedly a $200 value), a member profile (supposedly a $2,000 value), and an annual customized peer analysis of their CDFI performance (supposedly a $225 value).  I would love to find out how they derive the values for these benefits, by the way.

So am I missing something here?  Somebody please take a look at this and tell me that we are not all victims of an elaborate scam perpetrated right under our noses and under the auspices of our desire to help out on the unemployment front.


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8 responses to “ Give or Take?”

  1. Deborah Drake - Authentic Writing Provokes

    So let me get this straight. It appears that money is being granted according to the FB page and also Starbucks helps Starbucks as Google helps Starbucks and Banana Republic helps the Cause, provided you are shopping in their store.

    Yes, I get. Send money “there” and everybody wins?

    I would like to think this is working but I too will dig deeper.

  2. RL

    Typical of liberals. Gather money by pulling on hearttrings and then keep it all to themselves

  3. Mark

    NOT typical of “liberals,” RL. At least we’re attempting to do something to remedy the economy. What’s the Grand Old Party up to, blaming the President? That really helps things, no?

  4. Nancy Truax

    I resent the comment “Typical of liberals”. I just bought a pound of coffee and the money is suppose to go to like to believe that it really goes to help create jobs.I know a great way to create jobs: THE CONGRESS PASS THE JOBS BILL. Get people working on infrastructure that is desperately needed as much as jobs are needed! Guess it’s more important to work on making Obama a “one term President” than helping the country!

  5. Kim Gardner

    The only way to create jobs is for the consumers to take over because the gov’t is not going to. I no longer buy anything made in China. This is very time consuming and is a big sacrifice because I can only buy things I need(not made in china) and not things that I just want(unless made in USA) but it has saved me a lot of money. If there is no demand for something then there is no need for supply, which could possibly bring jobs home if we as consumers chose not to buy unless made here or in smaller countries that we do not owe millions or trillions to. As far as createjobsusa, I don’t know but at least they are trying something instead of just bitching about it. I feel I am doing my part but I am only one person and it would take a lot more consumers than me to bring jobs home.

  6. Rhea Wynn

    I was “given” a free wristband this morning at Starbucks and told to remember to vote today. Before I started wearing it, I wanted to know what my wearing of the bracelet would imply I supported. Sounds good on their website and on the surface – but your article made me want to dig deeper before I lend my support, either monetarily or just implied by wearing the bracelet. Thanks.

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