MALONE —
A special prosecutor will likely be named to look into allegations that former ComLinks Chief Executive Officer Nancy Reich misused $100,000 in agency funds for her personal gain.
An audit from the State Comptroller's Office accuses her of using grant funds to pay for massages, room service and out-of-town trips and to hire consultants to perform work that was never done.
One person was reportedly hired to do an in-depth background check on a former co-worker who had reported his suspicions of money misuse to the Board of Directors.
Another consultant was allegedly told to secretly supply Reich with copies of certain employees' e-mail messages.
FIRINGS URGED
The state audit recommends that Chief Financial Officer Brenda Mallette-Glennon, Executive Director Brian Cassini and board member Rick Ellis be terminated and "a competent executive director" be hired.
All information gathered was forwarded to Franklin County District Attorney Derek Champagne, who will petition County Court Judge Robert G. Main Jr. to appoint a special prosecutor to look into possible fraud charges against Reich.
The DA said grant programs administered through ComLinks for crime-victim advocacy and domestic-violence victims are tied to the operation of his office.
"I don't want there to be the appearance of impropriety," Champagne said, so he will request a special prosecutor.
The audit slams Reich — who led the agency meant to help the underprivileged of Franklin County — for enjoying "a lavish lifestyle" with public funds.
It also criticizes Mallette-Glennon, Cassini, Ellis, former Board President John Ray and the rest of the Board of Directors.
CONSULTANTS
Reich is accused of spending $26,994 for consultants. That is allowed on a limited basis for either technical-services rendered or training only, but she reportedly hired three consultants to create a new image for ComLinks.
Three more were paid $10,292 out of grant funds: one as a job coach/team builder, one to rewrite the agency's policies and the last to provide personal mentoring for an employee.
But the auditors could find no record of any services rendered and no documentation to show any results.
A seventh consultant was hired to coach employees with holistic care, a practice described as "questionable at best and arguably not necessary or applicable to the programs supported by the grants."
Yet another was hired to conduct an in-depth background check on a former director, "in retaliation," the audit said, for a letter he wrote to the board calling for Reich's resignation and protesting her alleged misuse of funds.
TRAVEL COSTS
Reich reportedly spent $13,956 in travel expenses, including $427 on the agency credit card for a room, manicure and spa treatments for herself and a friend at Mirror Lake Inn in Lake Placid; $800 for plane tickets to New York City, Seattle and Louisville, Ky.; and $1,909 for a business conference in Washington, D.C.; she didn't actually attend the workshops but charged spa treatment and room service while there.
Thirteen times, she took a cash advance but then charged the full amount to ComLinks.
More than $8,000 was paid for four people to attend a two-day conference in San Francisco, including a private attorney Reich reportedly brought along that she was intending to hire.
ENTERTAINMENT
The report found $14,533 in inappropriate spending on meals and alcohol for visiting state employees who monitor ComLinks grant programs. The people paid her cash for their meal, but the entire expense showed up on the credit-card bill as a business meeting, even though no business was discussed.
She also apparently purchased food for staff gatherings and lunches, birthdays, holidays — even alcohol for an employee's going-away party — with grant funds.
"One expense charged to 'employee development' was actually cheesecakes for the staff holiday party," the report states.
The Board of Directors also reportedly used $6,473 in grant funds for expensive dinners and drinks at Whiteface Lodge and Malone Golf Club, the audit says.
GIFTS
Reich reportedly used ComLinks money to buy a name-brand handbag for a departing employee, as well as vests and attaché cases from Lands End for others.
She spent $400 on a one-night, two-person gift package at the luxurious Fairmont Chateau Montebello hotel in Quebec and gave it to a volunteer as an appreciation gift.
QUESTIONED
An independent auditor hired to look at the agency's books for the year ending Sept. 30, 2006, questioned adjustments and grant allocations, late-payment charges and cash-flow issues.
Reich asked him to change his opinion and allegedly "made an inappropriate offer" to the man, who was fired when he declined both.
The comptroller found that staff members were not allowed to know about their budgets or ask about finances, leaving Reich and Mallette-Glennon as the only two people spending the grants.
"Mallette-Glennon told auditors she knew her actions were inappropriate, but she continually succumbed to the pressures of Ms. Reich because she feared the repercussions of challenging her boss," the report states.
Former board members on the Personnel Committee, who implemented a new policy to perform yearly evaluations on Reich, rated her as a poor administrator. She then either cut them off with no communication or told them only what she wanted them to know.
BIG PURCHASES
The board ignored its policy for big-ticket purchases, which are supposed to go out to bid for goods priced higher than $5,000.
ComLinks bought nine vehicles from board member Rick Ellis but went through the bidding process only once, the audit said.
Resolutions passed by the board falsely state the bidding process was followed, and at least one of the non-bid purchases was made when Ellis was president of the ComLinks Board.
BOARD CRITICIZED
Auditors questioned the competency of the entire board.
There was little or no oversight of expenses, bills submitted, travel vouchers or mileage claims, the report states.
"The board failed to hold Ms. Reich accountable for her actions, and as a result, she was given free rein to do as she wished.
"Even with numerous flags, the board gave Ms. Reich a separation agreement with included a severance package."
DIRECTOR'S HIRINGS
Cassini, as executive director, was criticized for hiring a director even though the person did not go through the proper hiring channels and didn't fit the advertised qualifications for the position.
Fred Gagnier, who was hired as the agency's housing director, had once coached Cassini's son in football.
"It appears that Mr. Gagnier was hired for his personal relationship with Mr. Cassini rather than based on his qualifications," the audit states.
Cassini was also cited for writing excessive job qualifications for a nutrition-related position tailored to fit his wife's qualifications at pay nearly three times the usual rate.
When the position was advertised as a consulting position instead of a nutrition manager, only three people qualified: his wife, the daughter of a board member and someone else.
When the position was manager level, several people applied, but only Elizabeth Cassini applied for the consulting job.
Her husband excused himself from the hiring process but continued to work on the consulting contract without board approval, the audit states.
The board approved hiring Mrs. Cassini a month after she had signed the consulting contract, where she was paid $55 an hour for 28 to 30 hours a month, compared to the manager's job, which was advertised at $20 an hour for 64 hours a month.
Mrs. Cassini's contract was terminated as a result of the audit.
E-mail Denise A. Raymo at: draymo@pressrepublican.com
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