A New York Times analysis has revealed that the Federation of Multicultural Programs of Brooklyn, an organization that cares for developmentally disabled people, has received more citations for significant lapses of care—27—than any NY State-licensed organization that runs group homes for this demographic. Most providers of similar size have received no more than two citations, said The Times. The Federation is licensed to run a group home that cares for those with autism, Down syndrome, and cerebral palsy.
In 2006, the Federation’s board hired retired police officer, Danny King, who, The Times said had no experience in the field, as its chief executive, paying him $350,000 annually and allowing him to put his son, two sisters, and a sister-in-law on the Federation’s payroll. King filed for personal bankruptcy in 2002 and left the police department making less than $60,000 annually. Auditors deemed the Federation “not fiscally viable,” said Philanthropy Today.
The Federation filed for bankruptcy protection two times in the 1990s at the same time it owed the Internal Revenue Service (IRS) over $3 million and two key Federation executives—its executive director and chief financial officer—were charged with embezzling over $2 million in government-provided funds, The Times pointed said.
State auditors discovered questionable expenditures of $900,000, such as a trip to Puerto Rico for key employees and no-interest employee loans that came through a secret bank account utilized by CEO Victor Medina, said The Times. Medina’s temporary replacement, Ismael Betancourt Jr., wrote an extensive letter in 1994 to city and state officials accusing Medina of using off-the-book accounts and credit cards for personal expenses, and making what Betancourt Jr. described as excessive payments to a cleaning company.
“Something smells,” Betancourt wrote. “An investigation is needed,” he added, The Times reported. In 1997, five New York City agencies either canceled or would not renew contracts.
Medina died in 2001; the case was not concluded in his lifetime. Gibson reached a plea agreement and never served prison time.
Despite a long history that includes financial problems, hiring scandals, and dubious resident care, New York State continues to pay the Federation a stunning $20 million annually in the form of Medicaid funding, Philanthropy Today
New York State has never attempted to end its relationship with the Federation which, said The Times, points to the amount of control the state has given nonprofit providers to house developmentally disabled people. This, noted The Times, in the 40 years since New York State received a court order to stop sending the developmentally disabled to large institutions.
In all, nonprofit producers receive in excess of $5 billion annually from Medicare to house and take care of developmentally disabled citizens, said The Times.