FAIRVIEW HEIGHTS, Ill. - Non-profit Lessie Bates Davis Neighborhood House (“LBDNH") has agreed to pay the United States $100,000 and enter into a compliance agreement to resolve a civil False
Claims Act investigation relating to the operation of its AmeriCorps program, U.S. Attorney Steven
D. Weinhoeft announced today.
AmeriCorps is a federally funded network of national service programs addressing
critical community needs including increasing academic achievement, mentoring youth, fighting
poverty, sustaining national parks, preparing for disasters, and more. AmeriCorps
volunteers (called members) commit to service for a period of three months to a year
in exchange for a living allowance, education awards, and other benefits. From 2015 to 2018,
LBDNH received over $1.9 million in federal AmeriCorps funding.
The settlement stems from investigations conducted by the Southern Illinois Public Corruption Task
Force and the AmeriCorps Office of Inspector General (“OIG"). The Task Force
investigation resulted in Christopher Coleman pleading guilty to embezzling more than $250,000 from
LBDNH by generating false invoices and receiving cash kickbacks. Coleman was the
Executive Director of LBDNH from July 2016 to February 2018.
Leonard Johnson, of St. Louis, Missouri, and Jeremy Turner, of Dallas, Texas, were convicted in
federal court for aiding and abetting Coleman’s embezzlement. Tiffany Taylor, of
Maryville, Illinois, was charged with making false statements to federal agents during the
investigation. She successfully completed a pre-trial diversion program.
AmeriCorps OIG opened a civil investigation looking for violations of the False Claims Act. As a
result of the OIG investigation, the United States alleges that from 2015 through 2019 LBDNH,
through Coleman and others, failed to implement internal controls sufficient to
prevent embezzlement of federal grant funds and misrepresented it AmeriCorps expenses on
periodic expense reports submitted to the AmeriCorps prime grantee.
In addition, grant recipients like LBDNH are required to verify and certify the number of service
hours each individual volunteer completes. Each volunteer must complete a specified number of
service hours, along with other requirements, to receive an AmeriCorps education award. The
United States also alleges, from 2015 through 2019, LBDNH falsely certified to AmeriCorps that some
of its members had performed the service hours necessary to qualify for an education award, when
they, in reality, had not.
“The Lessie Bates Davis Neighborhood House was a mess, and we used our criminal and civil authority
to clean it up," said U.S. Attorney Steven D. Weinhoeft. “Four criminal indictments and a civil
settlement have resulted in federal criminal convictions, prison time, restitution orders, civil
payments, and a compliance agreement to ensure that this never happens again. Our decisive action
is a clear message that programs administering taxpayer funds must do so responsibly."
“The Lessie Bates Davis Neighborhood House was easy prey to fraud because it had none of the
internal controls needed to protect the organization from unscrupulous actors," said AmeriCorps
Inspector General Deborah Jeffrey. “Every director of a nonprofit should ask executives and
independent auditors what their organization does to prevent and detect fraud, and what more it
could do to ensure that all of its funds are being used to support community needs."
The claims resolved by the settlement are allegations only; no lawsuit was filed in court, and
there has been no determination of civil liability. The individuals responsible for the fraud at
LBDNH are no longer employed there. LBDNH cooperated with the OIG investigation and voluntarily
outsourced its accounting and finance functions to a third-party firm. As part of the settlement,
LBDNH entered into a five-year compliance agreement with AmeriCorps. Included among the terms of
the compliance agreement are that LBDNH must implement fraud detection and prevention
policies and trainings. The agreement also mandates certain bi-annual reporting
requirements to AmeriCorps. LBDNH has represented it intends to maintain its outsourced
accounting arrangement through the compliance agreement period.
The investigation was conducted by the AmeriCorps Office of Inspector General. Assistant United
States Attorney Ray M. Syrcle handled the settlement for the United States.
Source: U.S. Department of Justice, Office of the United States Attorneys
