Attorney General Schwalb Sues Anti-Violence Organization and Its CEO for Misappropriating More Than $250,000 In Nonprofit Funds

OAG Previously Terminated Cure the Streets Contract with Women in H.E.E.L.S, Now Seeks to Recover Misused Funds


Attorney General Brian L. Schwalb today announced a lawsuit against Women in H.E.E.L.S (Healing, Elevation, Empowerment, Love, Support), Inc. (WIH), a non-profit organization with the stated purpose of reducing violence and supporting women and girls, and Ikeia Hardy, its former CEO, for misusing nonprofit funds. In its lawsuit, the Office of the Attorney General (OAG) alleges that more than $250,000 in government grant funds intended to support gun-violence prevention work through OAG’s Cure the Streets program were misappropriated. The lawsuit seeks to recover the misappropriated funds. 

“Women in H.E.E.L.S. and Hardy misused grant funds intended to keep District residents safe—taking advantage of taxpayers and undermining gun violence prevention efforts in Congress Heights,” said Attorney General Schwalb. “My office holds our grantees accountable through rigorous oversight and as soon as we become aware of this illegal conduct, we terminated the Women in H.E.E.L.S. grant. Now, we are seeking to recover the misappropriated funds and ensure that they are redirected toward public safety efforts in the District.”  

Hardy incorporated WIH as a DC nonprofit in November 2020.  In March 2022, OAG awarded grant funding to WIH to operate one of four new violence-reduction program sites as part of OAG’s Cure the Streets (CTS) program. OAG awarded the grants through a competitive process, and selected WIH to operate a CTS program site in Ward 8’s Congress Heights neighborhood.

CTS is a community-based public safety program funded by OAG that aims to reduce shootings and gun homicides in areas of the District where gun violence has been a persistent problem. OAG provides grant funding to qualified local organizations, which implement the CTS program in designated neighborhoods. The program uses a data-driven, public health approach to making communities safer by de-escalating potentially violent conflicts and intervening with individuals who are at high risk of committing violence or becoming victims of violence.

WIH received grant funding of up to $814,000 annually in Fiscal Years (FY) 2022 and 2023 to operate the Congress Heights CTS site. In 2023, OAG discovered financial irregularities at WIH and moved swiftly to suspend and then terminate WIH’s grant funding. After further investigation, and after giving WIH and Hardy multiple opportunities to explain their conduct, OAG filed suit alleging that WIH and Hardy violated District law by:

  • Diverting $57,302 in charitable funds to Hardy’s personal checking account. From June 2022 until March 2023, Hardy transferred $57,302.48 in nonprofit funds—which were also District grant funds—from WIH’s business and savings accounts to her personal checking account.
     
  • Failing to return more than $200,000 in unspent grant funds after WIH’s grant agreement was terminated. When WIH’s grant agreement was terminated, OAG demanded that WIH return $59,678.08 in FY 2023 grant funding that had not been spent, and return $153,500.00 in FY 2022 grant funds for which documentation of spending had never been provided. WIH returned none of it.

OAG also alleges that Hardy violated DC law by failing to uphold her duty as a nonprofit officer by misappropriating funds, and by allowing WIH to lose its federal tax-exempt status and its DC nonprofit status. (The Internal Revenue Service revoked WIH’s nonprofit status after the organization failed to file the required file Form 990-series return or notice for three consecutive years.) OAG also charges that WIH violated DC law by contracting with a WIH employee’s separate company, in violation of its grant agreement and related regulations.

With this lawsuit, OAG is seeking to recover the funds improperly transferred to Hardy and recover the unspent grant funds that were not returned when the agreement was terminated.

A copy of OAG’s complaint is available here.

This matter is being handled by Assistant Attorneys General Leonor Miranda and Cara Spencer, supervised by Adam Gitlin, Chief of the Antitrust and Nonprofit Enforcement Section.

About the District’s Nonprofit Corporation Act

Under the District’s Nonprofit Corporation Act (NCA), the Attorney General has the authority to police nonprofit activities and ensure that nonprofit entities operating in DC spend their funds to serve their stated missions. Nonprofit organizations are set up to benefit the public, and nonprofit funds cannot be spent to benefit a private individual or company—especially an individual who has influence over the organization.

OAG’s Nonprofit Enforcement Work

Since becoming an independently elected Attorney General’s office, OAG has steadily expanded its capacity to enforce District laws governing nonprofits. Recently, OAG sued the former Treasurer of an elementary school’s parent-teacher organization for misusing nonprofit funds and secured a settlement requiring her to return the misappropriated money. OAG also sued the former executive director of a local affordable housing nonprofit who diverted more than $1.25 million to pay himself unauthorized bonuses. Previously, the office secured a revised deal to sell the Providence Hospital campus for residential redevelopment that protected $5 million in healthcare resources for the District and ensured that the proceeds of the sale of property owned by an affordable-housing nonprofit would still be used to provide affordable housing in the District. OAG also resolved actions against  the Coast Guard Auxiliary Association for improper payments to its Board President, and Delta Phi Epsilon, Inc. for using nonprofit funds for personal gain.

If you suspect that a nonprofit or officer of a nonprofit doing business in the District of Columbia is violating District law, please contact OAG at (202) 727-3400 or at nonprofit@dc.gov.