One of my favorite newspapers is the New York Post. It doesn’t matter who you are, if you are stealing you aren’t safe from the eagle eyes and sharp pencils of the Post. Hardly a day goes by without another expose of a politician or charity bigwig with his or her hand in the public till.
Earlier this year, the Post carried a story about the head of the United Block Association. Its executive director, Kwame Insaidoo, was charged by federal prosecutors with conspiracy, embezzlement and wire fraud. Justice Department officials say he laundered and took $953,875 belonging to the charity.
Regular readers of this blog know that we regularly report on the False Claims Act and the ability to collect cash whistleblower awards for reporting greed and fraud. The federal False Claims Act requires there to be a loss to a federal program or federal funds. Charities are by their nature private entities. Often, however, they receive government funds.
United Block Association Fraud
Let’s take a look at the United Block Association. It is a nonprofit foundation that operates a “meals on wheels” program for New York City seniors. Many seniors are homebound and can’t get out to cook or shop. Helping seniors remain home and out of nursing homes is certainly a worthwhile goal. Bringing food to these folks helps them retain their independence and is far less costly than a nursing home stay.
Both New York City and the federal government recognize this and fund the foundation. That means embezzling funds from the nonprofit is the equivalent of stealing from taxpayers. If a nonprofit receives tax dollars and those dollars are misused, whistleblowers can earn a reward for coming forward and reporting the fraud.
In the case of Insaidoo, prosecutors allege that he created a shell company called Allied Home Care. He would then transfer foundation funds to Allied and subsequently into his own pocket. By moving money to a legitimate sounding business, Insaidoo apparently thought he would not get caught.
Where did the money go? By now, the theme should be familiar to all. The Justice Department say he used the money on his home, a luxury car, clothes and personal bills. Instead of our money going to feed homebound seniors, Insaidoo spent the money on fancy clothes and a luxury ride.
We remind readers that Insaidoo is presumed innocent until proven guilty. Criminal charges are only allegations.
The False Claims Act and Whistleblower Awards
The federal False Claims Act allows people with inside information about fraud or wrongdoing to collect whistleblower awards. The amount of the award is based on a percentage of the money recovered from the wrongdoers. New York State and several other states have similar award programs.
In this case, the person reporting Insaidoo could receive up to 30% of whatever the government recovers from him. Even if Insaidoo is acquitted of the criminal charge, he could still remain civilly liable for any monies he may have embezzled.
Frauds rarely take place in a vacuum. There is always one or more people who know what is happening. Many do not know how to report fraud, however, and do not know about the whistleblower awards available to them. Others are afraid to step forward and may not be aware of the strong anti-retaliation protections that are available.
How to Report Fraud and Collect an Award
If you have inside information about theft or misuse of government funds, including funds given to charities and non-profits, you may be eligible to receive a sizeable award. The process of collecting an award involves filing a sealed complaint in federal court. (State court if filing under the New York State False Claims Act.) The complaints are secret while being investigated by the government.
To date our whistleblower clients have received over $100 million in awards. Our mission is to not only get our clients the maximum available whistleblower awards but also protect them from retaliation. There is never a fee or any costs unless we are successful in pursuing your claim.
For more information, contact attorney Brian Mahany at *protected email* or by telephone at (414) 704-6731 (direct). You can also download our 11 Step Guide to Whistleblowing. All inquiries are kept strictly confidential and protected by the attorney – client privilege.
MahanyLaw – America’s Whistleblower Lawyers
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