Comptroller Thomas P. DiNapoli, Attorney General Eric T. Schneiderman and New York City Department of Investigation (NYC DOI) Commissioner Mark Peters today announced the conviction of a nonprofit executive accused of pocketing taxpayer dollars intended for public services and capital improvements in New York City. A multi-agency joint investigation, including NYC DOI and two federal agencies, exposed the theft of approximately $300,000 in public funds provided by New York State, the New York City Council, and federal earmark grants. A jury convicted Dorothy Ogundu on 29 counts, including Grand Larceny in the Second Degree, and she faces up to 15 years in prison.
Dorothy N. Ogundu, engaged in a scheme to defraud the city of New York, the state of New York and the United States using her not-for-profit corporation, Angeldocs, Inc. Angeldocs received a total of twelve government grants. Ogundu stole a portion of each of the twelve government grants by filing fraudulent requests for reimbursement and making false statements to the government agencies administering the grants. Ogundu used the money she stole from these government grants to pay the mortgage and utilities on a commercial property she owned, make improvements to that property to increase its value, purchase and ship vehicles to Nigeria, and make other purchases for her personal benefit and for the benefit of her for-profit business.
“Ms. Ogundu let her publicly-funded clinic gather dust while she stole $300,000 in government grants, buying vehicles to ship to Nigeria," said State Comptroller Thomas P.DiNapoli. "By teaming up, our joint anti-corruption task force was able to expose her crimes and work to convict her of this shameful thievery.”
“Today’s conviction sends a clear message: if you use taxpayer funds to line your own pocket, you will face serious consequences,” said Attorney General Schneiderman. “We will continue to work with Comptroller DiNapoli and our law enforcement partners to use every tool at our disposal to crack down on anyone abusing the public trust.”
DOI Commissioner Mark G. Peters said, “This defendant manipulated a system meant to provide financial support to families struggling with health care costs for her own enrichment. DOI will continue to aggressively investigate evidence that City-funded organizations are misusing public funds and ensure that anyone who abuses their position or compromises public trust is held accountable.”
“In this case the theft of U.S. taxpayer funds through grant fraud is driven by nothing more than greed,” said Scott Lampert, Special Agent in Charge of the Office of Inspector General, U.S. Department of Health and Human Services, New York Region. “We look forward to working with the N.Y. Attorney General Office and other federal investigators to bring these criminals to justice.”
“Ms. Ogundu was entrusted to use federal, state, and local funds to provide for the health and well-being of our citizens. The jury’s verdict proves, instead, that she bypassed the rules to siphon taxpayer dollars for her own use. The combined efforts and attention of our state and federal law enforcement partners should send a clear, strong message to our grant recipients that we will not tolerate the misuse of our funds for personal gain, and that those who fail to exercise integrity in connection with our grant programs should expect to meet a costly and unpleasant end,” said Christina Scaringi, Special Agent in Charge, U.S. Department of Housing & Urban Development, Office of Inspector General, Northeast Region.
Ogundu received two types of government grants for Angeldocs: program grants to support Angeldocs programs and capital grants to improve the Angeldocs facility. To obtain payment on the program grants Angeldocs received, Ogundu falsely claimed that she spent grant funds on expenses related to various Angeldocs programs, primarily rental space for the programs. Ogundu diverted nearly all of the program grant funds to pay the mortgage and utilities on a commercial building she owned through a holding company, instead of using the building for the programs she promised to provide.
To obtain payment on the capital grants Angeldocs received, Ogundu claimed that she was building a state-of-the-art demonstration kitchen and making other capital improvements to a building that she falsely claimed was used by Angeldocs. Instead, Ogundu received kickbacks on the kitchen project from a contractor and diverted other capital grant funds to pay the mortgage on her building and other personal expenses.
As a result of the scheme, Ogundu stole approximately $300,000 in government grants: approximately $91,000 from the City of New York, approximately $67,000 from the State of New York and approximately $140,000 from the United States.
Individual disbursements of public funds are not themselves evidence of any wrongdoing, and it would be inappropriate to presume that any particular public official has engaged in misconduct simply by directing funds to a non-profit.
Ogundu was convicted on 29 counts, including Grand Larceny in the Second Degree, Forgery in the Second Degree and Offering a False Instrument for Filing in the First Degree.
Assistant Attorneys General’s Jihee Suh and Travis Hill of the Attorney General’s Public Integrity Bureau prosecuted the case with assistance from Morgan McCollum. The Public Integrity Bureau is led by Bureau Chief Daniel Cort and Deputy Bureau Chief Stacy Aronowitz. The investigation was handled by Investigators Gerard Matheson and Angel LaPorte of the Investigations Bureau. The Investigations Bureau is led by Chief Investigator Dominick Zarrella. Forensic auditing analysis was provided by Deputy Chief Auditor Sandy Bizzarro of the Forensic Audit Section. The Forensic Audit Section is led by Chief Auditor Edward J. Keegan, Jr. Executive Deputy Attorney General Kelly Donovan leads the Criminal Justice Division.
The joint investigation was conducted with the Comptroller’s Division of Investigations with Special Agent William Martinez of the Office of the Inspector General of the United States Department of Housing and Urban Development, Special Agent Dan Connor of the Office of the Inspector General of the United States Department of Health and Human Services.
Since taking office in 2007, DiNapoli has committed to fighting public corruption and encourages the public to help fight fraud and abuse. New Yorkers can report allegations of fraud involving taxpayer money by calling the toll-free Fraud Hotline at 1-888-672-4555, by filing a complaint online at [email protected], or by mailing a complaint to: Office of the State Comptroller, Division of Investigations, 14th Floor, 110 State St., Albany, NY 12236. Review prior cases at http://www.osc.state.ny.us/investigations/index.htm.