Problems with activerecord/oracle addapter

I am working on a project and we are having problems displaying utf8
charaters. my system specs & settings are:

this is what i did and the outputs of it form ruby script/console. why
is it doing this to me?

data = Data.find(391808)
=> #<Data sponsoring_unit: “Dusseldorf Germany” … >
In the database it is Düsseldorf Germany

data.sponsoring_unit = “Düsseldorf Germany”
=> “Düsseldorf Germany”

data.save
=> true

data = Data.find(391808)
=> #<Data sponsoring_unit: “D??sseldorf Germany” … >

*** LOCAL GEMS ***

actionmailer (2.3.2, 2.2.2)
actionpack (2.3.2, 2.2.2)
activerecord (2.3.2, 2.2.2)
activerecord-oracle-adapter (1.0.0.9250)
activerecord-oracle_enhanced-adapter (1.2.0)
activeresource (2.3.2, 2.2.2)
activesupport (2.3.2, 2.3.0, 2.2.2)
acts_as_reportable (1.1.1)
acts_as_versioned (0.2.3)
alib (0.5.1)
archive-tar-minitar (0.5.2)
cached_model (1.3.1)
calendar_date_select (1.15)
cgi_multipart_eof_fix (2.5.0)
color (1.4.0)
daemons (1.0.10)
facets (2.5.2)
fastercsv (1.4.0, 1.2.3)
fastthread (1.0.7, 1.0.1)
gem_plugin (0.2.3)
git (1.0.5)
hoe (1.12.2, 1.10.0)
mailfactory (1.4.0)
mechanize (0.9.2, 0.9.1)
memcache-client (1.7.2, 1.7.0)
mime-types (1.16)
mislav-will_paginate (2.3.10)
mongrel (1.1.5)
mongrel_cluster (1.0.5)
mysql (2.7)
nifty-generators (0.2.3, 0.2.2)
nokogiri (1.2.3, 1.2.1)
orderedhash (0.0.6)
passenger (2.2.0, 2.0.6)
pdf-writer (1.1.8)
rack (0.9.1)
rails (2.3.2, 2.2.2)
rake (0.8.4, 0.8.3)
RedCloth (3.301)
rubyforge (1.0.3)
rubyzip (0.9.1)
ruport (1.6.1)
ruport-util (0.14.0)
transaction-simple (1.4.0)
ZenTest (4.0.0)