NEWORLEANS-- A now-defunct New Orleans non-profit organization that operated after-school programs has been flagged for possible criminal violations after an audit revealed that it collected grant money for expenses it never incurred.
A state legislative audit released Monday also showed that the program's director used grant money for personal expenses, including a trip to Africa and pet supplies.
The audit shows that Open World Family Services was reimbursed $129,402 by the Louisiana Department of Education by submitting 'false information to support expenses.' The money came from a federal grant for educational services for underprivileged children.
Legislative Auditor Darryl Purpera said the group was reimbursed for the federal grant money from 2009 to 2012 by sending falsified documents connected to employee benefits, transportation expenses and other payments to vendors.
The audit states that Open World sent bi-monthly detailed reimbursement requests to the state Department of Education, listing check numbers, dollar amounts and dates. But a reconciliation with the organization's bank accounts revealed that at least 55 checks were never issued or cashed.
'When we looked at the actual evidence, we saw expenses that really didn't occur, yet this organization received payment because of those falsifications,' Purpera said. 'That indicates potential for a violation of a theft statute or other criminal violations.'
Open World operated under the direction of Kim Cassell from 2000 to 2012, when it disbanded, according to the organization's old website.
The audit found that Cassell frequently used grant money for personal use, including travel expenses on trips to Minnesota and the African country of Liberia, pet supplies, veterinary services and unauthorized tuition payments for an employee.
The audit also found that Cassell violated state nepotism law by hiring her brother and daughter, paying them $10,865 and $7,549 respectively.
Cassell could not be reached for comment. But in a written response included in the audit, attorney Jauna Crear said Cassell never intentionally broke any rules.
'Kim Cassell had no prior experience in non-profit financial management,' Crear stated. 'As such, she made a number of errors that showed a lack of knowledge of grant management. At no time did Ms. Cassell aim to misappropriate Open World's funds.'
In the response, Crear said all of the grant money was spent appropriately, although sometimes payments to vendors were made much later than indicated or paid through cashier's checks instead of bank checks as reported to the state.
'Ms. Cassell maintains that all funds received from this source were used for program-related and/or business-related transactions,' Crear wrote.
As for the money used for personal expenses, the attorney stated that some of the travel expenses were actually a combination of business and personal uses, while other payments were made mistakenly due to the fact that 'funds in the Open World bank account were hopelessly co-mingled' with other accounts.
The state auditor isn't buying it.
'I would say I'm unconvinced that this is a bookkeeping error,' Purpera said in an interview. 'This group actually falsified documents that were being provided to the Department of Education.'
As for the nepotism findings, Crear admitted that Cassell hired her family members, but wrote, 'Ms. Cassell was not aware of the prohibition on hiring family members. She did not hire her family because of their relation; she hired them because of their qualifications, coupled with their willingness to work for a limited income.'
Purpera said he forwarded the audit to the state attorney general and Orleans Parish District Attorney's Office to review for possible criminal charges.