4 charged with NYC child welfare thefts
July 16, 2008
By LARRY NEUMEISTER
NEW YORK - An official assigned to investigate fraud at a city agency turned out to be among those charged with embezzling over $450,000 that was supposed to help needy children, authorities said Wednesday.
Lethem Duncan, deputy director of the Payment Services Department of the Administration for Children's Services, is charged along with another ACS official and two foster agency workers. Some of the money, stolen since 2004, was used on an $84,000 BMW, a 2006 Range Rover and $30,000 in rent for an apartment with a private garage.
Their arrests come a day after Judith Leekin, 63, of Port St. Lucie, Fla., was sentenced in a separate case to nearly 11 years in prison. She stole more than $1.6 million by making false claims that allowed her to adopt disabled 11 children in New York since 1988. She denies allegations in an ongoing Florida prosecution that she badly mistreated those children after moving to that state.
Rose Gill Hearn, commissioner of the city's Department of Investigation, said a yearlong probe of the city agency that distributes $74 million a month in adoption subsidies and payments to not-for-profit foster care agencies has revealed a "hornet's nest" of problems, beginning with poor financial accountability.
The flaws attracted some people who liked the "proximity and access to the great river of money that flows through ACS and the opportunity to help themselves to it illegally," she said.
U.S. Attorney Michael Garcia said the four people arrested in the latest case were involved in two schemes.
In one, coconspirators falsely posed as adoptive parents to receive subsidies, Garcia said. In the other, they faked an ACS bill for computer services and then authorized its payment.
Two of the defendants were arrested Tuesday when they brazenly went to pick up a $711,420 payment from Duncan, who by then had agreed to cooperate with DOI, Garcia said. The payment was for a fictitious computer supplies invoice.
Garcia said the defendants were "driven by greed and they placed their own self interest ahead of the children."
Duncan was charged with conspiracy to commit mail fraud, mail fraud, conspiracy to commit embezzlement, embezzlement, money laundering and accepting illegal gratuities. Since 1998, he has served as a deputy director at ACS.
Nigel Osarenkhoe, supervisor of adoptions in ACS's Payment Services Department, was charged with mail fraud conspiracy.
Two others arrested in the probe were charged with mail fraud conspiracy, embezzlement conspiracy and money laundering.
The U.S. attorney's office said the names of the defense attorneys could not immediately be determined. However, the four were due in court later Wednesday.