The green bins of Gaia

Gaia's clothing collection business flourishes in Chicago, but its promises to promote the environment are questionable. Meanwhile, the organization's leaders are under criminal indictment in Europe.

Chicago Tribune/February 12, 2007
By David Jackson and Monica Eng and Courtney Flynn contributed to this report

On a rainy June morning in 2000, a bright green bin landed on a Wrigleyville street corner.

Looking like an oversize chartreuse mailbox, it bore a strange poster that made a big promise: You feed in your old clothes, and our charity will sell them to finance environmental projects around the globe.

"We hire rangers," the box said, for "the protection of the living earth."

The projects ranged from the logical, like saving barrier reefs, to the puzzling -- "acting as partners in the solidary humanism." And although there was something peculiar about the language and the charity's uber-greenie name -- Gaia-Movement Living Earth Green World Action Inc. -- the box worked.

Within a week, Gaia's first container was brimming with old clothes.

By November 2003, the success of that single box at Clark Street and Newport Avenue had spawned more than 550 clones, an army of green clothing collection bins that seemed to rise overnight in parking lots and strip malls from Hazel Crest to Highland Park.

Gaia, the registered charity that places the bins, said in tax reports that from 1999 to the end of 2002, it reaped more than $2 million selling the donated clothes.

But despite what the boxes say, the group spent little if any of those earnings on environmental projects, records and interviews show.

Instead, the ubiquitous green bins finance a shadowy international organization known as "Tvind," sometimes called "the Teachers Group."

Started in 1970 by a collective of teachers who ran a countercultural high school in Denmark, Tvind slowly morphed into a $100 million labyrinth of commercial ventures and charities spread across some 35 countries, U.S. and Danish government records show.

In Denmark, prosecutors have charged Tvind founder Mogens Amdi Pedersen and seven top aides with a multimillion-dollar embezzlement and criminal tax evasion scheme. Pedersen and his inner circle siphoned humanitarian funds into profitmaking sawmills and swank Miami apartments, prosecutors say.

Authorities in Belgium have indicted Pedersen and six Tvind leaders for money laundering.

Former Tvind members and European authorities have called the group a secular cult. Pedersen was a fugitive when FBI agents arrested him between international flights at Los Angeles International Airport in February 2002. A federal judge extradited the lanky, silver-haired guru to Denmark on an arrest warrant issued by the international police agency Interpol.

Pleading innocence, Pedersen said in Los Angeles federal court papers that Tvind is not a cult, but a group of dedicated humanists who live collectively and work to benefit the planet and the poor. Pedersen said he was being persecuted for political reasons.

But though Tvind leaders face criminal trial and front-page headlines in Europe, the group flourishes in the U.S.

In addition to several multimillion-dollar clothes collection businesses, Tvind has established three U.S. "institutes" in Michigan, Massachusetts and California that recruit volunteers to labor in Tvind-run development projects overseas.

Tvind's Chicago-area operations demonstrate how the international collective sustains itself by generous clothing donations, idealistic volunteers and the determination of middle managers who live in Spartan conditions for the sake of a revolutionary creed.

At the center are Gaia's green bins. They stand 6 1/2 feet tall and weigh 500 pounds when empty. In an America where the average person recycles or donates to charity less than a quarter of the 68 pounds of textiles he or she tosses out every year, the Gaia bins offer what people seem to want: painless altruism, cleaner closets and utter convenience.

"People want to feel good that they're donating clothes to a worthwhile place, but the first priority is to get it out of the closet," said Bernard Brill of the Secondary Materials and Recycled Textiles Association. "Convenience is the No. 1 item with disposal."

Starting at first in affluent neighborhoods such as Wrigleyville, Gaia's 57-year-old director Eva Nielsen began scouting Chicago box locations by bicycle in 1999. She placed the first box outside Einstein Bros. Bagels at 3455 N. Clark St. It filled up quickly. "I had the feeling that they had been waiting for us to come," Nielsen said in an interview.

To place the bins in the parking lots of gas stations and grocery stores, Nielsen said, Gaia needs only the permission of the business owners. Nielsen used to keep a binder full of signed consent forms, but as the number of boxes in the Chicago area grew, she says she began relying on verbal permission. To encourage business owners from Chicago to Wisconsin to host Gaia boxes, Nielsen gathers and hands out letters of endorsement from local government officials. In some cities such as Madison, Wis., authorities were skeptical and declined to write the letters. Madison recycling coordinator George Dreckmann said he examined Gaia's program and turned her down for a letter of support in the spring of 2002.

"I just really wasn't comfortable with their whole operation," Dreckmann said. "It sounds like employment for their folks as opposed to sending a lot of money toward the work they claim to be doing."

Supportive officials

But in Chicago, officials were more enthusiastic.

"I am most certainly supportive of the fine work of the Gaia Movement with respect to their efforts regarding environmental issues and the preservation of National Forest Preserves worldwide," Ald. Burton Natarus (42nd) wrote in a 2001 letter supporting the group.

City environmental commissioner N. Marcia Jimenez wrote a letter saying, "We encourage businesses in Chicago [to] consider allowing the Gaia Movement to place a collection box in front of the business, supporting local and global environmental protection."

Natarus wouldn't comment on his letter endorsing Gaia. Jimenez said through a spokesman that "we felt this was something very positive." Informed of the Danish indictment of Tvind leaders, her spokesman Mark Farina said Gaia is now "something we would look closely at."

Nielsen collected similar letters from the chief deputy Cook County Recorder of Deeds, and Aldermen Helen Shiller, Joseph A. Moore and Walter Burnett Jr. Of those four, only Moore would comment. "Knowing what I know now, I probably wouldn't have written the letter," he said.

Though Gaia has installed and maintains hundreds of collection boxes around Chicago, interviews show the bins aren't always properly located or welcome. A Gaia box sits on the sidewalk outside 1449 N. Ashland Ave., for example, despite Chicago ordinances prohibiting collection bins on public sidewalks and streets.

Store manager Welton Creyton said he has had no success persuading Gaia to take away its bin from the Food Basket grocery store parking lot at 368 E. 87th St. "We called to have it removed, but they haven't responded," Creyton said. It "can't go a week without getting overfilled."

On Chicago's South Side, Gaia's dark, low-slung warehouse at 8918 S. Green St. is stuffed nearly to its sloping wooden roof with smashed bundles of clothes.

Work pants tangle with gossamer blouse sleeves. Loose stockings clot ragged grocery bags. With mechanical heaves, a giant baler packs unwashed and unsorted loads into half-ton bricks that will be slipped into container trucks for shipment to central Europe and Africa.

And people give more than clothing. In the open warehouse, long tables groan with the detritus of American generosity: encyclopedias, children's toys and small appliances.

Through companies such as Gaia, Tvind has captured a sizable chunk of an improbably lucrative international market: ragpicking.

"You can see we've been quite busy," said Gaia director Nielsen, who joined Tvind in 1971 as a student in one of the group's first "Traveling Folk High Schools" in Denmark.

Tvind is accomplishing great things "because we've been sticking together and helping each other," Nielsen said.

Chicago-area charities including the Salvation Army and Marklund Children resale shops say they have noticed a dip in donations since the Tvind clothing collection operations took hold. Although it can't be quantified, "they do have an impact, no doubt about it. It does affect us," said Cheryl Lightholder, who runs Goodwill clothes collections in Chicago and the surrounding region.

"The average person doesn't necessarily realize who they're giving to," Lightholder said. "They want convenience."

Goodwill and other established Chicago-area charities have been phasing out street-corner clothes collection boxes because they can be an inefficient way of raising philanthropic dollars.

Clothes stuffed into metal bins become worthless when they get wet or when people toss in garbage or paint. If they aren't maintained, collection boxes can overflow, harbor rats and become community eyesores. But a not-for-profit operation can find it a costly burden to gas up the trucks and insure and pay the drivers needed to keep the bins emptied.

Controlling costs

Thanks to decades of experience in the rag trade, Tvind has figured out how to make clothing collection pay by controlling costs at every step. Gaia's hired workers are not unionized or offered health insurance -- though Nielsen calls such benefits "a human right." The Tvind clothing operations also use students who have signed up to participate in overseas development projects. They are asked to scout for new bin sites and perform other tasks as part of their training.

Besides Gaia, Tvind executives run two other U.S.-based clothing collection charities -- called Planet Aid and Planet Aid-Philadelphia -- that operate in 11 East Coast states and reported earning a total of nearly $18 million from 1999 through the end of 2002.

Tvind members also run an Elgin-based, for-profit clothes collection business called U'SAgain, with branches in seven Midwest and Western states. U'SAgain's Swedish-born director Mattias Wallander said in an interview that the company's profits were "none of your business."

"There is no relationship between U'SAgain and Gaia," Wallander said. But records and interviews show U'SAgain has baled and shipped Gaia's clothing; two of Gaia's eight officers have served on U'SAgain's board; and the two companies made a handshake agreement not to compete in certain Chicago-area locations.

Whether for profit or for charity, the Tvind clothing collection companies arrange their overseas sales through a Tvind broker in Atlanta called Garson & Shaw. Gaia paid at least $30,000 to Garson & Shaw in 2002, according to Gaia director Nielsen.

Former Tvind members have alleged that used clothing is exchanged among Tvind companies to inflate its value. "It is sold gross to private companies at symbolic prices and then resold to other companies or the public," former Tvind leader Steen Thomsen wrote in a 1998 report to Danish authorities.

Chicago's Gaia was launched with funds from one of Tvind's central treasuries, according to Tvind memos obtained by Danish police. In May 2000, Tvind's indicted leaders transferred $60,000 to buy Gaia containers and start the Chicago operation, according to the Tvind memos.

Gaia declared to the IRS that it received $60,000. But Gaia claimed -- and Nielsen insists today -- that the money was an unsecured loan from the Massachusetts-based Tvind clothes collection charity named Planet Aid.

The posters on Gaia green collection bins indicate the group generates $2 worth of nature programs from every dollar of donated clothing. But that pledge should not be taken literally, Nielsen said.

"It doesn't make sense if you take it concrete," she said. "It's like a symbol."

Gaia declares in tax filings that virtually all of the $2 million it reaped from 1999 through 2002 was spent on environmental programs. But the tax reports show more than 96 percent of Gaia's income went to running the clothing resale business, paying for things like bins, workers and Garson & Shaw commissions.

Nielsen says those were legitimate charitable program expenses because Gaia's resale business diverted textile from overtaxed landfills, thus providing an environmental benefit.

The group reported it gave $69,900 in "charitable donations to environmental causes" from 1999 through 2002 -- less than 4 percent of its total revenues.

As part of a typical pattern of money movement among Tvind ventures, the entire $69,900 was transferred to another, closely related Tvind charity, also called Gaia-Movement, but based in Switzerland.

Four of the Chicago Gaia directors -- including Nielsen -- have served on the board of the Swiss charity. And the Swiss outfit gave Gaia Chicago a $121,625 start-up grant in 1999. As part of an agreement between the two Gaias, the Chicago outfit will, in return, donate $135,000 to the Swiss Gaia or projects it designates, before funding any other environmental programs, records and interviews show.

In December 2003, following Tribune inquiries, the Chicago Gaia donated an additional $60,000 to the Swiss trust.

A gift or repayment?

At worst, the Chicago Gaia's grants might be viewed as Tvind's gift to itself; at best, repayment on a loan.

But that's only the beginning. When you try to follow the $69,900 dispersed so far out of Switzerland, it seems to evaporate in a stream of promises.

As of November 2003, the Swiss Gaia had used only $25,000 of the $69,900, records and interviews show. The $25,000 was divided evenly between two African environmental projects.

One is a $12,500 effort to preserve the Miombo Woodlands inside the Quirimbas National Park in Northern Mozambique.

There, Gaia says, its workers teach farmers methods of sustainable agriculture and grow crops in areas still home to wild animals.

Records and interviews show only half of the $12,500 has actually been spent on the project.

Agronomist Lebreton Saah Nyambe, who was responsible for the project until September 2003, said the effort was beset by bad weather and local skepticism about Gaia's farming methods. Far from convincing farmers to quit slash-and-burn techniques, Gaia's method of packing holes with manure led to significantly lower crop yields than farmers normally experienced. "It is painful to dig these holes and then get nothing," Saah Nyambe said. "Right now the farmers need food."

To ward off wild animals, Gaia taught the farmers techniques that failed -- burning caustic packets of chili pepper and elephant dung, and soaking guard ropes in oil and chili. "Animal destruction was worse than ever," Saah said.

This fall, Saah left the project and was replaced by a Mozambican administrator who has no agricultural experience.

But while Gaia's clothing operation is booming in Chicago, the story is different in Mozambique, Nielsen concedes.

There, where the group claims to be conducting environmental projects, "it's not going smooth," she said.

Monica Eng was a student in Tvind's Institutes for International Cooperation and Development from 1991 to 1992 in Massachusetts and Nicaragua. She has worked as a reporter and editor at the Chicago Tribune since 1996.