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District Wins $931,200 Judgment for Unlawful Diversion of Grant Funds Intended for Summer Youth Program

Friday, August 29, 2014

District Wins $931,200 Judgment for Unlawful Diversion of Grant Funds Intended for Summer Youth Program

CONTACT:  
Ted Gest, Public Information Officer
202-727-6283
ted.gest@dc.gov

WASHINGTON, D.C. – The District of Columbia has won a summary judgment for $931,200 in a case alleging that Washington East of the River Academy (WEALTHY), its principal, and its accountant unlawfully diverted District grant funds intended for a 2009 summer youth program, D.C. Attorney General Irvin B. Nathan announced today.

D.C. Superior Court Judge Maurice A. Ross on August 12 awarded the District the full treble damages it sought.

The case was brought in June 2013 under the District’s False Claims Act against Dianna R. Robinson, the former executive director of WEALTHY (formally Washington East of the River Academy of Entrepreneurship, Arts, Life Skills, Technology and Health for “Youth on the Rise”), accountant Darrell Johnson, and his firm, National Tax Pro, LLC.

WEALTHY obtained a $400,000 District grant in 2008 after submitting a detailed budget outlining how the funds would be spent.  The budget allowed for no more than $50,400 to be spent on any one staff position, and allocated only $24,000 for accounting services.  After securing the grant, WEALTHY submitted expenditure reports to the D.C. Children and Youth Investment Trust Corporation (CYITC), which administered the grant for the District, that falsely reported that the grant was being spent in accordance with its budget.

Instead, WEALTHY compensated Robinson $141,500 and paid Johnson and his firm $65,198 for accounting services.  Relying on WEALTHY’s false expenditure reports, CYITC paid out more than $300,000 in District grant funds.
 
“The Superior Court’s ruling reaffirms that those who receive grant funds from the District government must use the funds for their intended purpose, and must provide accurate and truthful reports of their spending,” Attorney General Nathan said.  He commended Ellen Efros, Deputy Attorney General for the Public Interest Division, Bennett Rushkoff, Chief of the Division’s Public Advocacy Section, and Assistant Attorneys General Catherine Jackson and Nicholas Bush for their work on the case.