Second Cooper Square staffer nabbed for embezzling
By Gerard Flynn
A second staff member at an East Village affordable housing group has been arrested and is under investigation on suspicion of stealing at least $50,000 from the nonprofit organization, the Manhattan District Attorneys Office said last week.
Nancy Velez, 31, has been charged with one count of grand larceny in the second degree and seven counts of falsifying business records in the second degree while serving as a director of management at the Cooper Square Mutual Housing Association between July 2005 and November 2007, D.A. spokesperson Jennifer Kushner said.
On the first charge, Velez faces up to 15 years behind bars. She has been released on her own recognizance. A trial date has not been set.
Velez allegedly cashed an unspecified number of checks, then altered financial records to conceal her crimes.
While declining to discuss the indictment until the cases conclusion, Valerio Orselli, the Cooper Square M.H.A.s executive director, said in a statement, We have internal systems of control, and once we started to have some idea that something was amiss, we exercised them.
The news follows the August sentencing of Felicia Blackman, 47, to between one and three years following a plea deal on identical charges. Blackman had been the president of the M.H.A.s board before becoming the bookkeeper downstairs at the Cooper Square Committee in November 2003.
In July 2008, Blackman confessed to cashing checks in her name totaling $187,000 over four years.
A nonprofit organization partially funded by the state, the Cooper Square Committee has an annual budget of between $250,000 and $300,000, its executive director, Steve Herrick, said.
While adding that Blackman was not the authorized signatory on either of two banking accounts, Herrick would not confirm if a staff member had been signing blank checks on Blackmans behalf.
While Blackman admitted to stealing a much smaller sum in November 2007, a decision to alert the district attorneys office was not made until March, Herrick, said because the case would have been very weak and would have resulted in a sentence of probation.
Herrick leveled sole responsibility with a certified public accountant, Joseph Topolsky, who like Blackman had come to the committee from the Cooper Square Mutual Housing Association, where he had been auditing the books for more than eight years.
Ms. Blackman falsified bookkeeping records, and our auditor, Joe Topolsky, did not detect fiscal malfeasance, Herrick said. He also did not uncover the fact that we were in arrears to the I.R.S, a fact that Ms. Blackman was concealing from the organization, Herrick added.
The nonprofit group has entered into an installment agreement with the I.R.S. to pay $85,000 in unpaid taxes over the next three years, and has recovered about 40 percent of the funds stolen by Blackman, Herrick said.
Topolsky, while waving aside questions on professional misconduct, denied any responsibilty for Blackmans actions. He shot back that had management conducted independent verifications at either bank, Blackmans crimes would have been discovered much sooner.
Although Topolskys contract with the Cooper Square Committee was terminated in July, he said it was news to me that upstairs the M.H.A. had followed suit in letting him go.
In a subsequent statement, Orselli said while the Cooper Square Mutual Housing Association had also canceled Topolskys contract in July, he had not been notified because his cooperation may be required on a pending forensic audit.
Orselli added that, at this time, he has no reason to suspect any malfeasance by Topolsky.
Orselli dismissed rumors circulating among some occupants of the almost 400 units of low-income housing the M.H.A. manages in the East Village and Lower East Side that Velezs sister jumped the list and received a free apartment not long after becoming director of management.
Orselli also added that, despite being the M.H.A.s board president, Blackman had no input in Velezs hiring.
City Councilmember Rosie Mendez defended the Cooper Square Committee as having a very solid reputation in the community.
It has sponsored the development and preservation of over 500 low-income apartments, and has been active in preventing evictions and protecting tenants rights, she said.