U.S. SETTLES DISPUTE WITH LESSIE BATES DAVIS NEIGHBORHOOD HOUSE OVER ITS AMERICORPS PROGRAM

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FAIRVIEW HEIGHTS, Ill. – Non-profit Lessie Bates Davis Neighborhood House (“LBDNH”) has agreed to pay the United States $100,000 and enter into a compliance agreement to resolve a civil False 


Claims Act investigation relating to the operation of its AmeriCorps program, U.S. Attorney Steven 


D. Weinhoeft announced today.

AmeriCorps  is  a  federally  funded  network  of  national  service  programs  addressing  


critical community needs including increasing academic achievement, mentoring youth, fighting 


poverty, sustaining  national  parks,  preparing  for  disasters,  and  more.  AmeriCorps  


volunteers  (called members)  commit  to  service  for  a  period  of  three  months  to  a  year  


in  exchange  for  a  living allowance, education awards, and other benefits. From 2015 to 2018, 


LBDNH received over $1.9 million in federal AmeriCorps funding.

The settlement stems from investigations conducted by the Southern Illinois Public Corruption Task  


 Force   and   the   AmeriCorps   Office   of   Inspector   General   (“OIG”).   The   Task   Force 


investigation resulted in Christopher Coleman pleading guilty to embezzling more than $250,000 from 


 LBDNH  by  generating  false  invoices  and  receiving  cash  kickbacks.  Coleman  was  the 


Executive Director of LBDNH from July 2016 to February 2018.

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Leonard Johnson, of St. Louis, Missouri, and Jeremy Turner, of Dallas, Texas, were convicted in 


federal  court  for  aiding  and  abetting  Coleman’s  embezzlement.  Tiffany  Taylor,  of  


Maryville, Illinois, was charged with making false statements to federal agents during the 


investigation. She successfully completed a pre-trial diversion program.

AmeriCorps OIG opened a civil investigation looking for violations of the False Claims Act.   As a 


result of the OIG investigation, the United States alleges that from 2015 through 2019 LBDNH, 


through   Coleman   and   others,   failed   to   implement   internal   controls   sufficient   to 


  prevent embezzlement of federal grant funds and misrepresented it   AmeriCorps  expenses on 


periodic expense reports submitted to the AmeriCorps prime grantee.

In addition, grant recipients like LBDNH are required to verify and certify the number of service 


hours each individual volunteer completes. Each volunteer must complete a specified number of 


service  hours,  along with other  requirements, to receive  an AmeriCorps  education award. The 


United States also alleges, from 2015 through 2019, LBDNH falsely certified to AmeriCorps that some 


of its members had performed the service hours necessary to qualify for an education award, when 


they, in reality, had not.

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“The Lessie Bates Davis Neighborhood House was a mess, and we used our criminal and civil authority 


to clean it up,” said U.S. Attorney Steven D. Weinhoeft. “Four criminal indictments and a civil 


settlement have resulted in federal criminal convictions, prison time, restitution orders, civil 


payments, and a compliance agreement to ensure that this never happens again. Our decisive action 


is a clear message that programs administering taxpayer funds must do so responsibly.”

“The Lessie Bates Davis Neighborhood House was easy prey to fraud because it had none of the 


internal controls needed to protect the organization from unscrupulous actors,” said AmeriCorps 


Inspector General Deborah Jeffrey.   “Every director of a nonprofit should ask executives and 


independent auditors what their organization does to prevent and detect fraud, and what more it 


could do to ensure that all of its funds are being used to support community needs.”

The claims resolved by the settlement are allegations only; no lawsuit was filed in court, and 


there has been no determination of civil liability. The individuals responsible for the fraud at 


LBDNH are no longer  employed  there. LBDNH  cooperated with the OIG investigation and voluntarily 


outsourced its accounting and finance functions to a third-party firm. As part of the settlement, 


LBDNH entered into a five-year compliance agreement with AmeriCorps. Included among the terms  of  


the  compliance  agreement  are  that  LBDNH  must  implement  fraud  detection  and prevention  


policies  and  trainings.  The  agreement  also  mandates  certain  bi-annual  reporting 


requirements  to  AmeriCorps.  LBDNH  has  represented  it  intends  to  maintain  its  outsourced 


accounting arrangement through the compliance agreement period.

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The investigation was conducted by the AmeriCorps Office of Inspector General. Assistant United


States Attorney Ray M. Syrcle handled the settlement for the United States.


 

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