NYC dropping homeless shelter operator after reported mismanagement, ethics violations

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

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.

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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