New York City nonprofit pulled in $5.3 million in contracts despite owing debt to state

New York City officials awarded $5.3 million in contracts to a nonprofit that owes the state $143,678 for allegedly misusing grant money to fund immigration services rather than services for crime victims, the Wall Street Journal reports.  

The Institute for the Puerto Rican/Hispanic Elderly received several contracts last month from the city Department for the Aging to provide services for seniors, after a January judgment that required the organization to pay up to the state. The decision came as a result of a 2018 lawsuit filed by the state attorney general’s office that followed an investigation by the state’s Office of Victims Services, which also noted the nonprofit failed to inform the state it was taken over by the scandal-ridden shelter provider Acacia Network in 2016.  

Acacia took over the institute’s leadership after its then-executive director faced a separate investigation related to misusing city money five years ago. But Acacia’s been no stranger to controversy itself: It’s currently facing a city probe for allegedly failing to disclose its ties to a for-profit security firm. Gov. Andrew Cuomo initially ordered an investigation into conditions in a building overseen by the nonprofit and Five Star Management, and this week called to expand its scope to explore accusations that they had been threatening to evict tenants reporting those conditions to the state. This news comes days after a man was stabbed to death in an Acacia-run shelter, bringing further scrutiny on the beleaguered organization.

Editor's note: This story has been updated with a statement from a spokesman with the Acacia Network:

"Acacia Network was not a party to this judgment, was not responsible for it or subject to it, and was never notified of it, until it was brought to our attention last week. Acacia has instructed its attorney to immediately take steps to vacate or pay the judgment against (The Institute for the Puerto Rican/Hispanic Elderly).

"Acacia's 2016 affiliation agreement with (The Institute for the Puerto Rican/Hispanic Elderly) took effect after a Department of Aging investigation determined that (The Institute for the Puerto Rican/Hispanic Elderly) was in urgent need of re-structuring. It is important to point out that Acacia has fulfilled every submission of information required to each agency with oversight over its affiliation with (The Institute for the Puerto Rican/Hispanic Elderly). Acacia's objective in entering into an affiliate agreement was to stabilize the organization and allow it to continue providing services to a most vulnerable elderly population, which would otherwise go without vital services."