Scoop: USAGM soliciting OTF partners as it withholds funds

The U.S. Agency for Global Media (USAGM) is trying to lure away partners that have provided services for the Open Technology Fund (OTF) to work with a different agency it has stood up called the Office of Internet Freedom (OIF), emails obtained by Axios show.

Meanwhile, the controversy-wracked USAGM under Trump appointee Michael Pack has also been withholding funds from the OTF, a government-supported nonprofit focused on building software that advances internet freedom.

• Sources say that USAGM has withheld nearly $20 million to-date of funding to the OTF, which critics fear is being routed to the OIF without Congressional approval.

Details: USAGM is reaching out to OTF grant recipients directly in an effort to get them to apply to work for the OIF, according to the emails.

• Sources say that some vendors have expressed concern as to how their contact information was obtained. The OTF manages sensitive work with journalists and technologists in areas where internet freedom is restricted.
• In emails to the OTF vendors, USAGM executives urged them to apply to OIF using a set of project categories that mostly overlaps with the OTF's areas of focus and told them they might be able to prequalify based on their existing relationship with OTF.

Between the lines: Observers argue that the USAGM maneuver is an effort to move the funding of internet freedom projects out from under OTF's more rigorous requirements so that money can be funneled to projects favored by USAGM leadership.

The big picture: The USAGM is facing lawsuits and investigations into its handling of OTF as well as other USAGM media agencies, like Voice of America.

• Last week, 6 USAGM employees filed a whistleblower complaint against USAGM that has since led to investigations by the State Department Office of Inspector General and the Office of Special Counsel.
• Last Friday oral arguments were heard in the lawsuit brought against Pack after he fired the boards of directors of OTF and other USAGM media outlets.
• After a report was published last week from NPR that alleged that two political appointees at USAGM were investigating a top VOA journalist for bias, Rep. Michael McCaul, the lead Republican of the House Foreign Affairs Committee, told VOA, “I remain very concerned about the state of affairs at USAGM and its grantees like OTF under CEO Pack’s watch.”
• Pack defied a Congressional subpoena two weeks ago to address questions about withholding funds to the OTF.

What's next: In August, the OTF filed a lawsuit against USAGM for withholding $20 million.

• Sources say USAGM might be trying to reroute funds from the OTF to OIF before that lawsuit can be resolved.
• The OTF has added a complaint to its existing lawsuit against USAGM that address the solicitations to vendors.
• A U.S. federal claims court ruled in late September that OTF will be granted an expedited hearing schedule in light of the new complaint.
• The court has set a final hearing on Nov. 4.