Press Release  Audit Finds Stronger Financial Controls Needed at Cambridge Non-profit

Boston — State Auditor Suzanne Bump today issued an audit of Hildebrand Family Self-Help Center, Inc. which found stronger financial oversight needed at the Cambridge-based human services provider. The audit reviewed activities of the non-profit, which provides short-term housing to homeless families, during fiscal years 2013 and 2014.

At the start of the audit, Hildebrand staff disclosed the misuse of $17,459 by a former employee that was inappropriately reimbursed by the Commonwealth. The misuse included: the organization’s finance assistant creating and processing what Hildebrand officials said were fraudulent invoices for the payment of her rent; $9,730 in improper credit-card transactions to purchase gift cards which were intended for use by clients to purchase emergency food and household items, but were never distributed; and $1,400 in questionable check payments.

Once identified, Hildebrand reported these incidents to the police, but not the Department of Housing and Community Development as required since state funds were used to pay these expenses. Hildebrand also improperly disclosed these incidents as reimbursable costs to its state contract in the 2014 financial statements submitted to the state’s Operational Services Division (OSD). The former employee was charged with larceny, and the case is being prosecuted in Cambridge District Court.

The audit also found that Hildebrand paid $209,855 to a member of its board to serve as a part-time consultant in the role of interim finance director during the audit period. Though this arrangement was appropriately disclosed, auditors found no evidence that the agreement met certain regulatory requirements and is therefore not reimbursable under OSD regulations.

The audit also found that $31,251 of inadequately documented expenses was charged to Hildebrand’s state contract, and that some of the board members did not meet the attendance requirements for board meetings.

Since the audit, Hildebrand has taken steps to address the findings including hiring a full-time Chief Financial Officer and replacing a member of the board who did not meet attendance requirements during fiscal years 2013 and 2014.

The Office of the State Auditor conducts performance audits of state government’s programs, departments, agencies, authorities, contracts, and vendors. With its reports, the OSA issues recommendations to improve accountability, efficiency, and transparency.

The audit of Hildebrand Family Self-Help Center, Inc. is available here.

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