City Probe Began 19 Months Ago

The Department of Investigation's probe into the Gloria Wise Boys & Girls Club in the Bronx began in January 2004, more than a year before the department labeled the nonprofit organization a "non-responsible" city contractor, terminating the club's city contracts.

City records also indicate that between 1991 and last month, the city engaged the Boys & Girls Club in 47 contracts worth a total of more than $15.5 million.

In addition to the contracts, the Gloria Wise club has also received grants over the years from the City Council, according to the council member whose district includes Co-op City, Larry Seabrook.

The president of Gloria Wise's executive committee, Jeannette Graves, has run Mr. Seabrook's district office for about two years. Mr. Seabrook said Gloria Wise had been receiving a "small amount" of money from the council since long before Ms. Graves took the job and he was elected. He denied there was any conflict of interest.

"She never lobbied me for any funds for them," Mr. Seabrook said.

At the request of the New York City Housing Authority, another Bronx nonprofit group, the Kips Bay Boys & Girls Club, will assume responsibility today for the administration of the Pathways for Youth program, which serves more than 2,500 children and seniors, and became an affiliate of Gloria Wise beginning in 2004. The previous year, Pathways for Youth had an annual operating budget of more than $8 million, which suggests that it represented almost half of Gloria Wise's budget.

The Department of Investigation has said it is examining Gloria Wise for alleged "inappropriate transactions," which include the transfer of $875,000 to Progress Media, former parent company of the Air America radio network, and to the club's director of development, Evan Montvel Cohen, who headed Progress Media.

Department officials have declined to comment on the status of the 19-month-old investigation.

The state attorney general's office is now looking into Gloria Wise in conjunction with the department, according to a spokesman for the attorney general, Brad Maione.

Mr. Cohen helped lead the launch of Air America on March 31, 2004. Less than two months later, Piquant LLC acquired the radio network from Progress Media.

Mr. Cohen has not responded to e-mail messages from The New York Sun asking about the transactions involving Air America and Gloria Wise.

Piquant has indicated its intention to pay Gloria Wise the $875,000 in installments, through an attorney-controlled escrow account. The company has not answered the question whether the Gloria Wise funds were absorbed by the radio network or disbursed elsewhere.

The owners of Air America have made an advance initial installment of $50,000 into the escrow account, an amount they say was agreed upon by both parties before they learned of the city investigation.

A spokesman for Gloria Wise, Jim Grossman of Rubenstein Public Relations, said yesterday Piquant has "agreed in principle to return the money, but there is no schedule and no money back - no timetable."

"All they have done is put something in an escrow fund," he said. "Lawyers for Gloria Wise are trying to get this into some formal agreement."

Air America contends that Mr. Grossman's characterization is misleading, and that an agreement has been reached between Piquant and the club that includes a timetable for a "voluntary repayment of loans made to Evan Cohen and Progress Media," according to a statement released by the radio network last night.

"Until the claims of financial impropriety are resolved, we're not going to give the club the money directly until we know it is going to an appropriate source," a spokesman for the network, Jaime Horn, said.

Several of Gloria Wise's board members have indicated they do not know the full nature of the Department of Investigation's probe.

According to 2003 filings with the Internal Revenue Service, the occupations of the Co-op City club's board members include an attendance teacher, a travel agent, a retired deputy chief of the city transit police, a New York Telephone administrative assistant, a bookkeeper for the Northeast Bronx Cultural Center, and the director of the Handicapped Adults Association. The organization's treasurer, Octavio Cruz, is assistant director of finance for the AIDS Service Center in Manhattan.

The former executive director of Gloria Wise, Charles Rosen, a former typographer and union activist whom many board members credit with the recent and rapid growth of the organization, has not returned phone messages from the Sun.

In the fiscal year 2002-03, Mr. Rosen earned roughly $220,000 for 23 hours a week of work for Gloria Wise and 15 hours a week at the Goose Bay nursery, a school for special-needs children under the same roof in Co-op City.

A member of the Gloria Wise board, Hillel Valentine, a former police officer, said in a telephone interview last week that for two years Mr. Rosen worked for free for the organization as he expanded it and its budget.

"People talk about the money he makes, but they don't have the responsibility he has," Mr. Valentine, who is secretary of the executive committee, said. "Charlie Rosen earned that money."

"He took a chance and he goofed," he said, suggesting that Mr. Rosen should not have extended loans to Progress Media or Mr. Cohen, his former colleague.

"We on the board are responsible for that," Mr. Valentine said.

The Boys and Girls Club of America, a federation of about 1,200 affiliates across the country, has said it may soon vote on whether or not to drop Gloria Wise from its ranks, a move that the federation's officials have characterized as very rare.

A spokesman for the federation, Evan McElroy, said yesterday that one of the requirements of membership the club violated was a mandate that member organizations submit an annual audit by an independent certified public accountant. Gloria Wise has failed to do so.

The Bronx club's spokesman, Mr. Grossman, has declined to comment on matters other than the negotiation with Piquant.

Correction from August 15, 2005: The city's Department of Youth and Community Development labeled the Gloria Wise Boys & Girls Club a "non-responsible" contractor.A story on page 1 of the August 12-14 issue of the Sun attributed that action to the wrong agency.