Audit: Urban League bilked taxpayers

An audit by the Erie County Comptroller has confirmed allegations leveled a year ago by social workers at the Buffalo Urban League that their employer charged the county tens of thousands of dollars for work never performed. Among the abuses: bills claiming some employees worked as many as 170 hours in a single day.

The audit also found the Urban League tried to stonewall investigators and retaliated against the whistleblowers who brought the problems to the comptroller’s attention. All eight have now left the agency – either fired or effectively forced out of their jobs.

The Department of Social Services, which holds the contract with the Urban League, also tried to stymie the investigation by withholding records, the audit found.

“If you look at the amount the Urban League overbilled, at best it is gross incompetence, at worst it’s actual fraud of the taxpayers of Erie County,” said Stefan Mychajliw, the county comptroller.

Susan Looby was one of the caseworkers who signed the letter sent to Mychajliw’s office last November asking for an investigation. “The things they were billing for – those services didn’t happen,” she said. 

This story is based on the audit report, interviews with five of the former Urban League employees who signed the letter to the comptroller, and internal Urban League emails and memos obtained by Investigative Post.

Key findings include:

  • The Urban League overcharged the county by an estimated $40,000.
  • Beyond trying to silence, and eventually punish whistleblowers, Urban League officials tried to suppress the release of the report.
  • The Erie County Department of Social Services took up to five months to release records and heavily redacted many documents.
  • Confidential client records were kept on an unsecure computer system that enabled any Urban League employee to access sensitive information.
  • Few staff members received adequate training on important skills and procedures such as reporting suspicions of child abuse. 

The audit covered only one year of the contract in question and did not consider any of the other six contracts the Urban League has with the county.

Urban League President and CEO Brenda McDuffie refused to comment for this story. McDuffie has close ties to Erie County Executive Mark Poloncarz; he appointed her to his transition team after being elected in 2011 and encouraged her appointment last year as chairperson of the Erie County Industrial Development Agency.

Also refusing to comment was Al Dirschberger, who Poloncarz nominated earlier this year as commissioner of the Department of Social Services. Dirschberger refused to comment on the grounds that he had not seen the final report, despite seeing a draft version which included all the substantive findings. But in a response to the audit, he acknowledged that while the Urban League had made some billing errors, “all known discrepancies have been reconciled and no known issues exist currently.” 

Preventive services

Erie County contracts with various agencies, including the Urban League, to provide state-mandated child welfare services. The $1 million contract audited by the comptroller involved preventive services: home visits and counselling to families that the Department of Social Services has determined are at risk of having children placed in foster care because of child abuse or neglect.

The Buffalo Urban League has contracted with Erie County to provide preventive services since 2001. The organization’s mission is “to empower African-Americans and other minorities and disadvantaged individuals to secure economic self-reliance, parity, power, and civil rights.”

The Urban League supports itself largely through service contracts like the one audited, according to its most recent 990 filing with the Internal Revenue Service. A list of donors provided online includes many prominent foundations, companies and individuals.

Excessive billing

The Urban League overcharged the county by almost $40,000 last year but no longer owes any money, according to the audit. Around half of that was from “excessive supervisory charges” involving hundreds of hours of work supposedly done by three workers on just one day, Aug. 29, 2014.

Those three workers billed the county for 130, 170 and 180 hours of “quality assurance” paperwork such as reviewing case files and checking for missing documents. Hours worked on some cases were exaggerated; in other instances, the county billed for work not performed at all, according to former caseworkers. 

The fraudulent billing caught the attention of caseworkers in September 2014. Agency emails and meeting minutes show that employees repeatedly raised their concerns internally months before writing to the comptroller. They say their complaints “fell on deaf ears.”

The Urban League reimbursed the county $20,313 in March this year for the hours it had overbilled.

“Just because they paid the money back, doesn’t mean it wipes the slate clean and it never happened,” Mychajliw said. “It happened.”

Four former caseworkers told Investigative Post this wasn’t the first time the Urban League had overcharged the county. At the end of 2013, they said, the Urban League added half an hour of work to each case in order to meet its annual target. The charges were withdrawn after caseworkers complained, they said.

The audit did not consider previous years’ work done under the preventive services contract.

The comptroller’s report also found the Urban League charged the county for an estimated $12,800 of “unsubstantiated billing hours” due to discrepancies across different billing systems. Auditors arrived at this figure based on a sample of billing done in August, where they did not find a single case where billable hours were consistent across the various systems.

In one instance, work was billed under Looby’s name while she was on vacation in Colorado.

“The county was billed for casework in my name that never happened because I simply wasn’t there,” she said.

The $12,800 figure was calculated by extrapolating the billing discrepancies across the whole year. The Comptroller’s office has determined that the Urban League no longer owes the county any money on the preventive services contract.

Dirschberger wrote, in a response to the audit, that since these problems were brought to the attention of Department of Social Services administrators, additional steps have been taken to avoid future errors.

Former workers say the overcharging was part of a culture where they were encouraged to “bill creatively” – charging for chance encounters with clients and embellishing the amount of hours they worked in order to meet billing targets.

“When you were unable to reach the family or were unable to provide the services you needed, you were told to basically embellish,” said Melissa Mattison, a former caseworker.

Listen to the radio version of this report produced for our partners at WBFO, 88.7FM.

Confidential records not secured

Auditors also found the Urban League’s record-keeping system “circumvents the State’s Privacy Law.”

Families involved in the child welfare system have a right to strict confidentiality under state law. In the state’s system, access to records is restricted to caseworkers involved in open cases. The Urban League’s contract with the county stipulates the state system should be the “the sole system of record” for case notes.

The Urban League, however, maintains a parallel system “without as strict confidentiality parameters,” the audit found.

In practice, former employees said, that meant a system full of confidential information – court findings and case notes – was “basically public” to anyone working for the agency. Even workers not involved in the preventive services program could access almost a decade’s worth of confidential records, they said.

“So, there was no confidentiality,” said Melissa Sears, a former caseworker. “If you were in preventive, I would know everything about your case – even if I’m not your caseworker. Which I shouldn’t.”

State officials from the Office of Children and Family Services agree that the lack of confidentiality is a problem, according to the audit. When contacted by auditors, they “expressed concern” and said they would work with the Urban League to correct the problem.

Lack of training

Although the audit was not intended to assess the quality of services provided by the Urban League, many of its findings support former employees’ complaints about workplace issues that compromised the quality of service they could offer families.

“I think it’s fairly safe to say that children and families are suffering because of the lack of training through the Buffalo Urban League,” Mychajliw said.

Auditors found, for instance, that the Urban League failed to properly train its staff.

Seven of eight new employees hired in 2014 did not receive enough training when they started the job, the audit found.

And of 30 existing employees, 24 did not receive the 40 hours of ongoing training specified in the county contract.

Two of the five caseworkers who taught parenting skills were not trained in reporting suspicions of child abuse. Another caseworker didn’t have the right educational background to do the job.

After reviewing a draft report of the findings, the Urban League responded that new employees “receive significantly more [training] than required” and disagreed about the lack of training for existing employees.

Former employees, however, agree with the comptroller’s assessment. They wrote in the letter that the training and certification opportunities described in the Urban League’s county contract “appear to be non-existent.”

“I received zero training in the entire time I was at the Buffalo Urban League,” Looby said.

In a response to the audit, Dirschberger wrote the Department of Social Services “will periodically monitor the annual training provided to contracted preventive services employees.”

Lack of cooperation

Mychajliw said he expected the audit to take about 12 weeks when he announced the investigation in November 2014. But it took 10 months to complete due to “significant pushback” from both the Urban League and the Department of Social Services, the audit noted.

“It’s mind-boggling how many road blocks the Buffalo Urban League put up to our auditors,” Mychajliw said.

Both the Urban League and the Department of Social Services delayed in arranging meetings and in providing records requested by the Comptroller’s office; one request took the Urban League almost five months to fulfill. In another case, according to the report, the Department of Social Services handed over records that were redacted beyond state requirements, resulting in further delays.

Even the initial meeting between auditors and Urban League administrators, originally requested on November 25 of last year, took a month to arrange.

Urban League officials, in their response to the audit, contended they did not obstruct the investigation, arguing that “the burden of the auditor’s requests for documents containing sensitive and personally identifiable information” could not be overstated.

Last week, Mychajliw said, Urban League President Brenda McDuffie wrote to him asking that the report not be made public because the agency had already repaid the money it owed the county.

“The way I took the letter was: we paid the money back, there’s nothing to see here, there’s no findings, so please withdraw it,” Mychajliw said. “I felt as though they were trying to bully and intimidate our office.”

Retaliation against whistleblowers

At last year’s Christmas breakfast, senior staff announced that because of the cost of legal fees related to the audit, employees would not receive bonuses, two former employees said. Bonuses were normally worth several hundred dollars; instead, workers received pens.

The Urban League has consistently denied any wrongdoing and portrayed the whistleblowers’ actions as an attack on the agency.

But agency records show that senior staff privately acknowledged problems with the agency’s billing methods at least a month before employees asked the comptroller to investigate.

When Mattison, the former caseworker, took her concerns over the blanket billing up with Urban League senior staff, she said, “I was told I was making trouble.”

In an email to the agency’s director of Human Resources last October, she wrote: “I am being treated unfairly for raising concerns about questionable billing.” She left the agency a month later.

Mattison said she was dismayed at the agency’s “digging their heels in” in response to the audit.

They could have from the beginning just said: we’re going to fix these problems and make sure that we’re doing the best service we can,” she said. “And they chose not to.”

The report will now go to the Erie County Legislature, and it’s up to lawmakers to decide what, if any, action to take.

Some of the whistleblowers hope that the audit’s findings will lead to further investigation.

“Where there’s smoke, there’s fire,” Looby said. “I do think they need to look at the other contracts. That’s millions of dollars in taxpayer money.”