Board of AIDS agency probes chief's expenses

Official fired after alleging misuse of funds at HERO

March 20, 2004|By Kate Shatzkin | Kate Shatzkin,SUN STAFF

The board of the local AIDS education organization HERO is investigating allegations that its executive director awarded himself several thousand dollars in bonuses during a fiscal crisis, paid for a personal trainer with charity funds and billed the nonprofit agency for questionable travel expenses.

The organization's deputy director, Indira Kotval, was fired Thursday, three days after she outlined the allegations against her boss, Dr. Leonardo Ortega, to HERO's 20-member board of directors.

In a five-page report to the board obtained by The Sun from a source close to the organization, Kotval wrote that she had become concerned over the past six months because Ortega was frequently away from the office.

After Ortega's assistant quit and passed on more concerns to her, Kotval wrote, she came to the office on a day off to examine records. She said she found that Ortega had paid a personal trainer with checks entered under the heading "community relations" in a ledger, along with checks that awarded him bonuses of "$1,000, $2,000 and even $3,000 over the period of time that we have had a fiscal crisis in November, December and January of this year."

Kotval wrote that she saw checks for $500 to $650 in per diem charges to HERO for food and travel. "When I compared them to the days he was at various meetings according to his appointment book for 2003, they did not tally," she wrote. "Also some of the per diem charges appeared to be for times when he was not away on work."

According to Kotval's account, Ortega's assistant said he was told that paying the personal trainer from HERO money was permitted by the executive director's contract.

"Even if this was in the contract, it seemed to me to be something unacceptable in a nonprofit, community-based agency desperate for funding," she wrote.

In a subsequent letter to the staff explaining her departure, Kotval said that Ortega and board President Carlton R. Smith dismissed her Thursday. "They gave me no reason," she wrote.

Sources in the organization said the board had been looking into similar allegations for a month before Kotval's presentation.

Reached yesterday, Ortega said he could not comment, on the advice of his attorney and HERO's attorneys, until the board concludes its inquiry.

Kotval also said yesterday that she did not want to comment on her report. In the document, she did note that Ortega had taken the organization "from one in debt and trouble to a large and thriving agency."

Smith issued a statement saying the board "will make sure all questions are completely answered so that the public's faith in HERO is maintained.

"We adhere to the strictest standards of accounting and management as we strive to be an efficient provider of services to our many clients, who we hope to protect from any harm these allegations might cause," the statement said.

Board member Lou Curran, a city public defender, said the board was confronting "serious personnel issues," and "is absolutely intent upon persevering until any crisis is abated and all issues have been resolved to everybody's satisfaction."

The board is scheduled to meet Monday night for an update on the inquiry.

HERO, which stands for Health Education Resource Organization, was founded in 1983 to respond to the emerging AIDS epidemic. It moved into its first permanent home five years ago in the Maryland Community Resource Center at 1734 Maryland Ave.

Its headquarters include a resource center where clients can receive services ranging from HIV education to counseling to a meal and a shower. HERO also does testing and outreach to try to prevent the spread of the disease and helps people with AIDS find housing.

The organization reported revenues and expenses of about $4.1 million on its 2002 tax return, the last year for which records were available. Most of the money came from government grants.

Three years ago, HERO completed a voluntary certification process called "Standards for Excellence" through the Maryland Association of Nonprofit Organizations, which requires compliance with standards of accountability and governance.

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