The Face to Face fraud case raises issues of governance

The St. Paul-based nonprofit Face to Face appears to have done everything correctly.

Founded in 1972, the half-century-old entity is a registered charity with the MN Attorney General’s office. The nonprofit files its IRS Form 990 tax return every year. The nonprofit posts its financial reports and tax returns on its website. The reports themselves are rich in detail about the nonprofit’s operations.

It was the nonprofit itself that identified the alleged fraudster on its staff and turned the information over to the authorities. Fox 9 reports,

St. Paul nonprofit that helps support homeless youth has turned in one of its former employees, accusing the woman of misspending its money. The money is meant to help children who are homeless with rental assistance.

Court documents show, Face to Face, a nonprofit that helps youth who are experiencing homelessness with rent and medical care, began internally investigating employees after noticing possible fraud.

The nonprofit’s former manager of youth homeless programs, 50-year-old Charlita Williamson-Prokop from St. Paul, is now charged with nine counts of felony theft by swindle. An arrest warrant has been issued, but she was not currently in custody as of 3 p.m. Tuesday.

The nonprofit’s most recent financials (for 2022), show total revenue of $4.7 million, most of which ($2.5 million) is provided through government grants. On the expense side, direct client assistance is the largest single item, approaching $1 million.

The alleged fraud itself only involves a relatively modest sum, in the tens of thousands of dollars, and appears to have been quickly caught.

Still, we are left with the case of a “charity” whose operations mostly consist of spending taxpayer dollars on poverty relief programs that appear to be duplicative of services already offered by local government, but without the direct accountability to local elected officials.