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Zynga denies mishandling FarmVille Haiti funds

In the first test of how much Facebook members should trust online gaming operators like Zynga with handling funds ostensibly destined for charitable causes, Brazil's largest online newspaper has conducted a major investigation into how Zynga structured its latest Haiti aid experience and its not pretty. Folha investigators question the ethics of inviting users to invest in Haiti aid, but requiring them to do so within a timeline and if the time line is not met, the money goes back to FarmVille, not Haiti. Zynga got great PR from its pre-earthquake Haiti activities.  But investigators in Brazil suggest something went amok this go-round.

The story went viral in Brazil this morning.  Marcelo Ballve over at TrueSlant, a former AP reporter in Brazil, picked it up in the US late this afternoon Eastern Time.

Brazil has tough internet laws that do not permit fake identities and met out stiff penalties for charity scams and sexual exploitation of minors. Google's huge Orkut service, the major online service in Brazil and India, is headquartered in Belo Horizonte. Brazil, the major provider of UN peacekeeping forces in Haiti, has a fundamentally different approach to assistance than the celebrity oriented focus one sees emanating from the United States. In an email to Folha, Zynga has denied allegations of improper activity. It's only a million dollars, but you can bet that Zynga wishes the whole thing would just go away.  

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