JEFFERSON, La. -- A Louisiana Legislative Audit report issued Monday accuses two Jefferson Parish nonprofits with ties to a former and current Jefferson Parish Council member of mishandling hundreds of thousands of dollars in state and federal grants.
One of the organizations, Thompson Thibodeaux Community Development Corp., was supposed to perform painting and minor home repair services to low- and moderate-income homeowners and provide mentoring services to at-risk youth.
The other group, the Reverend Mansfield Thompson Educational Foundation Inc., which operated Faith Academy, a private school in Marrero, was also supposed to mentor young people.
The report implicates former Councilman Byron Lee, who sat on the board of both nonprofits and voted 10 times to give them parish money. It also alleges ethical violations by Lee's successor, current Councilman Mark Spears, for legal work he performed for Thompson Thibodeaux while he was an assistant parish attorney.
Multiple sources tell Eyewitness News that FBI agents have begun investigating the auditor's allegations and that they will be reviewed by a federal grand jury probing possible corruption in Jefferson Parish government.
Auditor Darryl Purpera confirmed that he's given copies of his staff's report to the U.S. Attorney's Office in New Orleans and to the Jefferson Parish District Attorney.
'Many of the allegations are those of outright fraud and the use of governmental funds, including federal funds with raises serious issues under the criminal code, not just the administrative code,' said Dane Ciolino, a professor at Loyola Law School and expert on governmental ethics.
Purpera's staff reported that Thompson Thibodeaux spent more than $800,000 to complete less than $200,000 worth of painting and repair work and performed the services on less than 100 of the 130 homes the company agreed to paint or repair.
Thompson Thibodeaux also allegedly misspent or misappropriated nearly $250,000 intended for mentorship programs, including giving $56,500 to the step-mother of the state legislator who secured the grants, former state Sen. Derrick Shepherd of Marrero, the audit said. Another $6,000 meant for the mentoring program actually went to Shepherd's political campaign, the auditors wrote.
Meanwhile, more than $90,000 in Thompson Thibodeaux expenses were allegedly faked by Eddie Williams, a Thompson Thibodeaux board member, so he could redirect the money to Faith Academy, which Williams ran as executive director.
'The U.S. Attorney's Office in New Orleans has often gone after public officials, private individuals who have committed fraud in the use of government funds,' Ciolino said. 'This Legislative Audit report showcases those issues very prominently.'
The audit said that between 2005 and 2010, Jefferson Parish and state agencies turned over $344,124 to Faith Academy to help fund educational programs or provide temporary jobs to workers displaced by Hurricane Katrina, but almost $240,000 appears to have been improperly used by Faith Academy.
The report said that much of the money went to pay expenses at the school or paid for expenses created by Williams to replace cash he had taken from the church and school for his own use.
Patrice Walker, a current administrator at the Faith Christian Academy, says Thompson Thibodeaux and the Mansfield Thompson Educational Foundation are no longer involved in the school.
'All of the monies that were given should have been spent on the children and that's what's so heartbreaking,' said Walker. 'I think they just did not have a check-and-balance system and that's probably what was needed.'
Byron Lee led the charge on the parish council to give the public funds, including federal HUD dollars, to Thompson Thibodeaux. In fact, the nonprofit called the painting program 'Councilman Lee's Project Paint Lift Program.'
Lee was a board member for Thompson Thibodeaux until just days before he first voted to give parish funds to the nonprofit, the audit said. He served as a parish councilman until early 2012.
'I want it to be perfectly clear, I did nothing wrong by voting or appropriating funding for Thompson Thibodeaux,' said Lee. 'I violated no state, federal or ethical laws and nor was I involved with any alleged misappropriation of funds. I was not an employee, direct overseer or board member. I'm proud that I was able to serve a community that had diverse needs and direct support to families that no one else cared enough to help.'
Lee also alleged that the legislative auditor has had it out for the councilmember from his district since it became a majority-black district.
Lee's bother-in-law, Eric Thompson, received work from Thomspon Thibodeaux.
'In 2005 I completed a limited number of homes for Thompson Thibodeaux as a subcontractor,' said Thompson. 'I was paid only for homes for which paint services were provided. When speaking with the auditor, I stated that I performed work on some houses, but I was not sure of an exact number, but that I was paid for the work my company performed.'
Lee told auditors he didn't know Eric Thompson was involved in the work, but then the auditors found records showing that Lee not only knew, but attended meetings regarding his brother-in-law's involvement. The report says the family connections go deeper.
Eric Thompson's wife, Anatola Thompson, served as the parish community development director and approved invoices for work performed by a company that was in a partnership with her husband's firm, the audit alleged.
Anatola Thompson presented documents that she claimed proved that her husband's partner ended his subcontracting relationship with Eric Thompson before she approved the invoices.
But the auditors said the documents actually referred to a totally different relationship and that other records actually proved the partnership between her husband and the other contractor continued through the time she approved the payments.
The report was released early to the parish government and those implicated. Anatola Thompson resigned suddenly Sept. 26 without explanation. We asked Jefferson Parish President John Young if her departure had anything to do with the audit findings, but he reiterated his earlier refusal to comment on personnel matters.
Then there's Spears. The audit said that from February 5, 2007 through June 10, 2011, and prior to his election to the Jefferson Parish Council, Mark Spears worked as an assistant parish attorney and, at the same time, also did private legal work for Thompson Thibodeaux.
Auditor Purpera said, 'There were two policies. One required at a point in time that he report (the outside legal work), disclose it to his administration, he didn't do so. And the second policy said you can't do any outside legal practice and he continued to do legal practice after that.'
Spears said in a statement, 'I'm extremely disappointed in the findings of the Louisiana Legislative Auditor's Investigative Audit Report which was released today regarding myself and organizations that serve a meaningful and rewarding purpose in the Jefferson Parish community.
'The findings are misleading at best, and would have those that I serve to believe that I have done something wrong, when the auditors themselves know that this is not the case, based on the overwhelming evidence and supportive documents proving otherwise,' Spears added.
'The report is 100 percent accurate,' said Purpera. 'I understand he (Spears) might be upset with the facts, but those are the facts.'
Spears' attorney Tracie Washington said, 'The policy was that you had to give the parish attorney's office, 35 hours a week and then you could do what you needed to do as a private-practice attorney, so there was never any allegation at all that he misused his time while he was an assistant parish attorney.'
WWL-TV's calls to Thompson Thibodeaux officers were not returned. The non-profit no longer occupies its last known address on Lapalco Boulevard.
According to the charity watchdog group Guidestar, Thompson Thibodeaux lost its tax exempt status because it failed to file a form 990 with the IRS for three consecutive years. Tax records for Thompson Thibodeaux and the Rev. Mansfield Thompson's foundation note that the two entities are related.