A supervisor assigned to investigate fraud in New York City's child services agency was among four people charged with embezzling $450,000 meant for needy children.
Nigel Osarenkhoe, who supervised adoption payments for the Administration for Children's Services, truly betrayed the trust of the agency, said Rose Gill Hearn, commissioner of the city's Department of Investigation.
Osarenkhoe used his access to create phantom adoptions under aliases, thus obtaining adoption subsidies for himself, Hearn said at a news conference.
She said an investigation of the city agency that distributes $74 million a month in adoption subsidies and payments to not-for-profit foster care agencies revealed a hornet's nest of problems, beginning with poor financial accountability.
Hearn said Osarenkhoe was assigned to help investigate fraud last year after the city decided to examine the agency's adoption practices in the wake of the Judith Leekin case.
Leekin was sentenced Tuesday to 11 years in prison for stealing more than $1.6 million by making false claims that allowed her to adopt 11 disabled children in New York since 1998. After adopting the children, she moved to Florida and is accused there of abusing the children. She denies those allegations.
U.S. Attorney Michael Garcia said the four defendants in this case were involved in two schemes: falsely posing as adoptive parents to receive subsidies or faking a bill for computer services and then authorizing its payment.
Two defendants, both foster agency workers, were arrested Tuesday when they brazenly went to pick up a $711,420 payment from the other official, Lethem Duncan, who by then had agreed to cooperate, Garcia said.
Osarenkhoe was charged with mail fraud conspiracy. The foster agency workers charged with mail fraud conspiracy, embezzlement conspiracy and money laundering. All three were released on $250,000 bond each.
At a hearing Wednesday, Osarenkhoe's attorney told the judge his client was a pastor who needed to attend a church conference this weekend in Minnesota. The judge granted permission for the trip over the objections of prosecutors, who alleged that he funneled some of the agency money to his congregants.
Afterward, defense attorney John Rodriguez said Osarenkhoe looks forward to his day in court.
Duncan, who since 1998 has served as a deputy director at the Administration for Children's Services, was charged with conspiracy to commit mail fraud, mail fraud, conspiracy to commit embezzlement, embezzlement, money laundering and accepting illegal gratuities.
Duncan appeared in court on Tuesday and was released without bail, prosecutors said. His attorney did not respond to a telephone message seeking comment Wednesday.
