The big question that I believe should be asked from the following Madison Leader Gazette: what might/should the board have done differently? One suggestion: get another auditor. Two: have governance committee do an annual assessment regarding members' conflicts of interest. Other suggestions? Oh, and this CEO/Board must have some great connections: all the bad stuff has gone on for a while and no one has really done anything.
Please read - this is a doozy with no accountability and major use of the organization for personal gain and....the list goes on. An excellent case study in what should not happen at a nonprofit.
he CEO of one of the city’s largest nonprofit shelters stashed kin on the payroll and funneled millions of dollars into companies he has financial stakes in — alleged glaring conflicts of interest that the city claims it’s now cracking down on.
The Post examined 2,000 pages of tax returns, contracting disclosures and legal documents involving CORE Services Group and found a web of companies with extensive ties to the nonprofit’s CEO, Jack Brown.
Experts told The Post that the set-up appears to serve little purpose other than placing Brown at the center of lucrative transactions.
Among the alleged questionable practices revealed by the documents:
- Brown created a string of for-profit companies that have received millions of dollars to provide key services at CORE’s shelters, documents show.
- A firm in which Brown holds a substantial stake received more than $3 million in rent over two years from his non-profit, according to tax filings.
- At least three family members of Brown or members of the CORE’s various boards are employed by the nonprofit or related entities, according to records.
City officials have now revealed that last month, they ordered CORE Services to shutter the for-profits companies Brown had established to provide services.
“Any time a provider doesn’t comply with our oversight efforts, we take corrective action, including requiring restructuring as necessary, ending business relationships in some cases, or in rare instances working with law enforcement to identify bad actors,” said Department of Homeless Services spokesman Isaac McGinn.
City Department of Investigation spokeswoman Diane Struzzi added, “DOI is aware of concerns surrounding CORE and declines further comment.”
Questions about CORE’s financial set-up come as the nonprofit has scored more than $800 million in city contracts since 2014, primarily to operate homeless shelters across the city.
The Post first began inquiring about CORE and Brown in February after learning the nonprofit operated the shelter in Brooklyn’s Gowanus neighborhood where accused subway ripper Rigoberto Lopez allegedly stayed before the A-train stabbing spree in February. The crime spree left two dead and two others badly injured.
Brown made at least $501,000 from CORE and its affiliated nonprofits in 2019 alone, according to the group’s tax returns from that year, which are the most recently available.
Brown got another more than half a million dollars from his related for-profit subsidiaries, the New York Times said in a report published Sunday.
His brother, Curtis, was paid $140,000 the same year, the documents show.
The brother of a member of the nonprofit’s board of directors, Gordon Jackson, made at least $190,000 as CORE’s head of community affairs.
Additionally, records reveal that another tightly linked nonprofit controlled by Brown employs Mallory Jones, whose husband sits on the subsidiary organization’s board and made $174,000 that year.
Previously, Brown was a top executive at a private prison operator, Correctional Services Corp, enmeshed in an early 2000s Albany bribery scandal. The company was fined $300,000.
He later scored a contract from the federal government to operate a halfway house near the Navy Yard in Brooklyn. The site was exposed in newspaper reports in the early 2010s as offering shoddy services.
I have only posted a small part of the article but please go here if you want the rest of the story.