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Former head of city-funded Jamaica Plain nonprofit faces charges of embezzling $20,000

Posted by Matt Rocheleau  October 16, 2012 11:12 AM

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The former head of a city-funded Main Streets nonprofit faces charges that he embezzled nearly $20,000 in funds intended for community revitalization, authorities announced Tuesday after a 15-month investigation.

Carlos Schillaci, 58, worked as the executive director for the Hyde/Jackson Square Main Streets organization in Jamaica Plain for two and a half years before he was suspended in July 2011, when Boston police, city officials, and the nonprofit’s board began investigating possible financial irregularities.

Schillaci, who now lives in Easthampton, is expected to be arraigned Wednesday in Suffolk Superior Court on two counts of larceny over $250 and two counts of larceny by scheme, according to Jake Wark, a spokesman for the Suffolk County District Attorney’s Office.

The Suffolk County Grand Jury returned the four-count indictment against Schillaci on Sept. 25, officials said.

He is accused of embezzling $19,490.65 through unauthorized use of the organization’s debit card and unauthorized check deposits and used that money to pay for items and services for his personal use, prosecutors said.

Evidence and grand jury testimony suggest the money went missing between April 2009 and December 2010, according to the district attorney’s office. Schillaci began his role as the nonprofit’s executive director in January 2009.

The Hyde/Jackson Square Main Streets organization is one of 20 nonprofits within Boston Main Streets, a program founded by the city in 1995 that uses city funding to support business districts by improving storefronts and public spaces. Each of the nonprofits works with commercial districts in specified parts of the city.

In 2010, the city paid $30,500 to the Hyde/Jackson Square group for the executive director’s salary, officials have said.

Each Main Streets organization in Boston also receives “financial and technical assistance and intensive training in the Main Street approach” from the city as well as the National Trust Main Street Center, the city’s website says.

Six full-time staff assist the local districts, which also have access to city architects, design staff, transportation planners and technical assistance specialists, the site says.

Otherwise, the district-level organizations operate as nonprofits, each conducting their own fund-raising zfforts within that citywide program. The organizations manage the funds they raise via their own independent governing structure, treasurers, and financial records.

The groups recruit their own volunteers and host events to enhance a commercial district’s image and attract consumers.

The city commits a “significant portion of its federal Community Development Block Grant funds” to Main Streets.

Grant funding, however, is issued directly to store owners from the citywide Boston Main Streets program, meaning it would not be included in the district-level financial records review.

Around that same time that Schillaci was suspended, the Hyde/Jackson Square Main Streets’ board filed a police report requesting that police and the Suffolk County District Attorney’s office investigate allegations of financial irregularities within the organization.

The nonprofit board launched its own investigation and the city also started its own investigation at the order of Boston Mayor Thomas M. Menino, officials have said.

No Main Streets entity in Boston has ever been the subject of an investigation before, city officials have said. The Jamaica Plain Gazette reported that the investigation led the city to audit all 20 Main Streets organizations.

The police report the nonprofit’s board filed lists the Jamaica Plain Neighborhood Development Corporation as the “victim.”

The executive director of that nonprofit, Richard Thal, said last summer that his organization's role had been "payroll processor" for the Main Streets group since around 1998.

When the debt Hyde/Jackson Square Main Streets owed to the JPNDC surpassed $20,000 – a concerning and unprecedented amount, Thal said he contacted the Main Streets organization’s board.

After going 10 months without an executive director, the nonprofit hired Katie Reed, who had led another Main Streets nonprofit previously, to fill the role on an interim basis this past spring.

In late summer, the nonprofit hired a new, full-time director, but the board’s leaders have declined to publicly name the person. Board leaders have said they plan to make a bigger announcement about the hiring later this fall.

In a statement Tuesday, Sheila Dillon, the city's chief of housing and neighborhood development department director, said the new executive director of Hyde/Jackson Square Main Streets is Gerald Robbins.

"We are happy to say that the city’s collaboration with board during this difficult time has helped Hyde Jackson Square Main Street get back on track," Dillon's statement said.

"In just one year they have secured their finances, implemented new internal operating procedures to ensure financial stability, and hired a new executive director Gerald Robbins," the statement continued. "We are confident that Hyde Jackson Square Main Streets board will continue their revitalization work in the Hyde Square commercial district."

The nonprofit's board said in a statement Tuesday that they are "committed to working with the district attorney to bring Mr. Schillaci to justice and we look forward to refocusing our efforts on creating a vibrant and successful Hyde Jackson Square."

E-mail Matt Rocheleau at mjrochele@gmail.com.
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