NYC dropping homeless shelter operator after reported mismanagement, ethics violations

CORE Services Group executive Jack A. Brown under scrutiny since NYT investigation

New York /
Nov.November 23, 2021 09:33 AM
CORE Services Group CEO Jack Brown (CORE, iStock)

CORE Services Group CEO Jack Brown (CORE, iStock)

New York City is reportedly ending its relationship with one of the largest operators of homeless shelters after an investigation from the New York Times outlined its chief executive’s track record of ethical violations while at the group’s helm.

The Times reported that reasons cited for the city’s decision to cut ties with Jack A. Brown III and nonprofit CORE Services Group include mismanagement, conflicts of interest and high salaries for executives, including the more than $1 million the outlet found Brown was pulling in.

CORE was responsible for the operation of 15 homeless housing sites in the city, which includes shelters and hotels. The company has received more than $352 million from the city in previous years, the Times reported.

But the nonprofit has also been a source of controversy beyond Brown’s seven-figure salary. A Times investigation discovered the organization spent at least $32 million in contracts given to for-profit companies linked to Brown, including a security firm, maintenance company and catering business.

Brown also displayed streaks of nepotism, hiring at least five family members to positions.

There is also a financial dispute at play. The city has ordered CORE to repay $2.3 million for “excessive executive salaries,” which the Times reported the nonprofit has refused to do.

The city reportedly plans on continuing its pursuit of the funds, while CORE claims the city hasn’t paid the organization in a year, despite continuing to provide services.

In statements to the Times, both sides appeared to angle as the deciding party in ending the relationship.

“We and the mayor were crystal clear that if CORE did not reform in response to our corrective actions, the city would have no choice but to end our relationship with them,” Isaac McGinn, a Department of Social Services spokesman, told the Times.

CORE told the outlet the arrangement was “untenable” and said the group “is in discussions with the city to secure an amicable resolution to minimize impacts on CORE’s clients and employees.”

The nonprofit in September appeared to be taking over as the operator of Donald Trump’s much-maligned Ferry Point Links golf course in the Bronx. Days after the group’s contact appeared in a notice published by the city, the nonprofit withdrew from consideration.

[NYT] — Holden Walter-Warner





    Related Articles

    arrow_forward_ios
    The City Council reached a deal on a bill that will require new buildings with fewer than seven stories to go electric in 2024, and then will apply to buildings taller than that in 2027.
    New buildings must go electric under City Council deal
    New buildings must go electric under City Council deal
    Stephen Ross and Charles Kushner (Getty)
    Stephen Ross, Charles Kushner, other titans paid no federal taxes for years
    Stephen Ross, Charles Kushner, other titans paid no federal taxes for years
    Gov. Kathy Hochul (Getty, iStock)
    Hochul opens $539M homeowner assistance fund
    Hochul opens $539M homeowner assistance fund
    President Joe Biden (Getty, iStock)
    Treasury to expand reporting on shell companies in real estate deals
    Treasury to expand reporting on shell companies in real estate deals
    DHCR's RuthAnne Visnauskas and CHIP’s Jay Martin (Twitter, iStock)
    Rent-controlled units need 11% rent hike, but landlords will get 1%: analysis
    Rent-controlled units need 11% rent hike, but landlords will get 1%: analysis
    Mayor Bill de Blasio (Getty, iStock)
    NYC talked about converting hotels into affordable housing. Nothing’s happened yet
    NYC talked about converting hotels into affordable housing. Nothing’s happened yet
    Almost half of NYC buildings received either a D or F grade (Getty)
    48% of NYC buildings fail on energy efficiency
    48% of NYC buildings fail on energy efficiency
    Attorney General Letitia James, Tax Equity Now’s Policy Director Martha Stark and Mayor-Elect Eric Adams (Getty)
    Do-or-die: Group files final appeal for property tax reform
    Do-or-die: Group files final appeal for property tax reform
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...