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Post date: October 5 2006

Not-for-profit Agrees To Governance Reforms And Restitution

State Attorney General Spitzer today announced a settlement with the Gloria Wise Community Center, formerly called the Gloria Wise Boys and Girls Club, Inc., under which it will make numerous governance reforms. The not-for-profit corporation is located in Co-op City in the Bronx.

The Attorney General’s settlement with the newly constituted Gloria Wise Board of Directors requires the non-profit to institute internal governance reforms, including strict financial controls, participation in annual board training, adoption of policies and procedures that, among other things, ban employee loans, and restrictions on hiring of consultants. Gloria Wise will report to the Attorney General’s Office for a period of five years.

On September 27, 2006, Gloria Wise paid the City of New York $625,000 for City money it either wrongfully received or misused.

In addition, Charles Rosen, 63, of the Bronx, the former Executive Director, pleaded guilty to Grand Larceny in the third degree, a class D felony, Forgery in the second degree, a class D felony, and Obstructing Government Administration in the second degree, a class A misdemeanor. Jeffrey Aulenbach, 46, of Brooklyn, the former Deputy Executive Director, pleaded guilty today to Grand Larceny in the third degree, a class D felony, and Obstructing Government Administration in the second degree, a class A misdemeanor. Both guilty pleas related to their submission of false reimbursement claims and other documents to various government agencies.

During his plea, Rosen admitted that he had falsified reimbursements for business expenses submitted to the City Department of Youth & Community Development and the State Office of Children and Family Services for sports programs that the non-profit never conducted. He also admitted his role in falsifying business records submitted to the Department of Investigation during its probe of charitable funds that were diverted to the radio station Air America.

During his plea, Aulenbach admitted that he had falsified documents submitted to DYCD and the US Department of Housing and Urban Development for youth programs that were never provided by Gloria Wise. Instead, Aulenbach used the charitable funds for expenses that were not reimbursable to Gloria Wise and to cover a loan to an employee.

Under the terms of the plea agreements, Rosen and Aulenbach will make restitution of $38,575 and $32,363, respectively, and each pay a $5,000 fine. The agreement bars Rosen and Aulenbach from accepting employment at a not-for-profit corporation for a period of three years.

The guilty pleas were entered this morning before the Honorable Judge John Byrne, of Bronx County Supreme Court. Sentencing is scheduled for December 6, 2006.

"Today’s settlement and please fulfill the twin goals of obtaining restitution for Gloria Wise and defrauded City and State agencies while at the same time restoring confidence so that this well-regarded charity continues to serve the youth of Co-op City. This investigation and the resulting please demonstrate that my office will prosecute fiduciaries who manipulate the system," Spitzer said.

The Attorney General thanked the State Office of Children and Family Services New York City for referring the matter to his office and the Department of Investigation for its assistance with the investigation.

These matters were handled by Carrie H. Cohen, Assistant Attorney General in Charge of the Public Integrity Unit and Sally G. Blinken, Assistant Attorney General, Charities Bureau under the supervision of Felice Sontupe, Acting Deputy Chief, Criminal Prosecutions Bureau and Carolyn T. Ellis, Section Chief and Gerald A. Rosenberg, Chief, Charities Bureau. They were assisted by Investigators Kevin McCain, Lawrence McDonald and Steve Platt of the AG’s Investigations Bureau; Investigator Jose Ramos of DOI, and Detective Joe Santiago of the NYPD Bronx DA Squad.