Thursday, May 5, 2016

Missing Money, A Vicious Attack, and Slow Healing for a Charity's Leader

D. Alexandra Dyer felt as though her face were on fire.
She put her car into drive, but got only a couple of hundred feet before she had to pull over in searing pain and squeeze her eyes shut.
Rescuers arrived as the caustic drain cleaner turned her face purple and dissolved her skin. As recounted later by her lawyer, she then screamed four words that they could not possibly comprehend.
“Kim Williams did this!”
Ms. Dyer had just left work on that hot evening last August in Long Island City, Queens. As she approached her car, parked on a deserted stretch of Skillman Avenue, a man she had never seen before was waiting for her.
“Can I ask you a question?” he said. Before she could answer, he flung a cupof drain cleaner in her face, and fled.
It was the terrifying climax of a three-year drama, with accusations of embezzlement, a cover-up and collusion at the last place one might expect it: a charity that brings musical performances and arts programs to New York City’s hospitalized, disabled, elderly and poor.
Three people have been arrested. Ms. Dyer, 60, who had recently been hired as executive director of the charity, Healing Arts Initiative, has undergone multiple operations to rebuild her face.
Among those charged is Ms. Williams, 47, the charity’s payroll manager, who is accused of stealing more than $750,000 and orchestrating the attack after Ms. Dyer questioned her about bookkeeping lapses. The defendants, including Ms. Williams, have proclaimed their innocence through their lawyers.
The account of the attack, and the tense months leading up to it, were described by Ms. Dyer’s lawyer, Ronald G. Russo, because prosecutors have instructed Ms. Dyer not to speak publicly since she is a witness in the case.
The fallout continues. This month, Ms. Dyer filed a lawsuit against the board of Healing Arts Initiative on behalf of the charity itself, saying board members let the thefts happen on their watch. The suit seeks their removal. (Mr. Russo, a former federal prosecutor, is Ms. Dyer’s lawyer in the suit.)
A lawyer for Healing Arts, David G. Samuels, declined to comment on Thursday because of the continuing suit.
Ms. Dyer, a seasoned nonprofit executive, had taken the helm of Healing Arts in July, joining one of the city’s better-established arts charities. It was started as Hospital Audiences Inc. in 1969 by a pianist named Michael Jon Spencer, after he played a recital to a rapt audience at the Manhattan State Psychiatric Center.
Over the years, Healing Arts grew to a $5-million-a-year operation that serves 350,000 people annually, through workshops and live performances. It provides handicapped seating at Shakespeare in the Park, presents concerts by Alvin Ailey dancers and runs a gallery for artists with mental illnesses.
But some staff members had noticed a surge of fiscal irregularities in the past couple of years, Mr. Russo said. Checks were bouncing. The credit cards that Healing Arts used to buy blocks of discount tickets for its clients were being refused.
The organization’s debt had ballooned from under $100,000 to over $2.2 million from 2012 to 2015, even as the executive director at the time, J. David Sweeny, cut the staff to 14 employees, from 28, and reduced the rent by moving the charity’s offices from SoHo to Queens.
Photo
Kim Williams, who managed Healing Arts Initiative’s payroll, is among those charged in connection with the attack on Ms. Dyer last year.CreditNew Jersey State Police
At the heart of Healing Arts’ fiscal operation was Ms. Williams. She had been hired in 2011, through an agency called Professionals for Nonprofits, as a payroll clerk. Under Mr. Sweeny, she enjoyed wide latitude, especially after he got rid of the chief financial officer and did not replace her, Mr. Russo said.
Soon, she was effectively running the fiscal operations and had several other accounting employees reporting to her.
Ms. Williams, who had an apartment in the Kingsbridge section of the Bronx, seemed to live fairly well for someone who had started out at a yearly salary of $43,000 and had worked her way up to $60,000. She drove a late-model Mercedes, had a second home in Florida and posted about her shopping sprees on Facebook.
Some of her income may have come from a side business she owned and ran from her office computer called Virago Inc., which sold sex toys and offered online sex seminars.
But the real secret to Ms. Williams’s lifestyle, prosecutors and the police say, was that she stole prodigiously from Healing Arts, cutting checks to dozens of phantom employees and direct-depositing them into accounts controlled by her and her best friend, Pia Louallen.
“That’s how the whole financial thing got to us,” Lt. Alexander Fagiolo, commanding officer of the 108th Precinct detectives, said at a news conference this month.
From November 2012 through August 2015, according to prosecutors, Ms. Williams embezzled at least $750,000 — an average of more than $1,000 per workday. She kept $600,000 and gave the rest to Ms. Louallen, prosecutors said.
One longtime board member, Kitty Lunn, said that while she did not suspect that Ms. Williams was raiding the till, she was concerned about the declined credit cards and the checks that did not clear. She urged fellow board members to investigate.
In January 2015, the board hired a forensic accountant. His finding after several days of reviewing the books, according to Mr. Russo: “No improper transactions.”
Ms. Lunn, a paraplegic dancer who has headed her own nonprofit, was incredulous. In May 2015, she quit in frustration. “I said to the board,There’s something funny going on with the money, and all of you are going to be responsible,’” she recalled.
By this time, Healing Arts was looking for a new executive director — Mr. Sweeny had left for another charity, though he remains on the Healing Arts board. (He declined to comment, referring all calls to the board president, D. Leslie Winter, who did not respond to voice mail messages.)
Enter Ms. Dyer, with an M.B.A. from Columbia and decades of experience managing nonprofits. She also holds a master’s degree in divinity, wasordained a Roman Catholic priest by a group called Roman Catholic Womenpriests and is co-leader of a congregation in Greenwich Village.
Concerned when her new colleagues told her about the money shortfalls and climbing debt, Ms. Dyer began digging around, Mr. Russo said. When she asked Ms. Williams for access to the accounting system, he said, Ms. Williams repeatedly stonewalled her.
On Aug. 17, Ms. Dyer introduced Ms. Williams to a new chief financial officer she planned to hire. His name was Frank Williams (no relation to Ms. Williams) and, Ms. Dyer told her, he was an expert fraud-sniffer who would decipher Healing Arts’ imbalanced books.
Ms. Williams suddenly came down with a toothache, Mr. Russo said, and left the office. Later that day, the police said, she bought drain cleaner at a supermarket in Queens with her credit card.

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She was absent the next day, Aug. 18, claiming that she had to go for a dental procedure. Surveillance video revealed that she had come to the office at 6 a.m. and left with boxes of files, Mr. Russo said.
Ms. Williams never returned to work and stopped communicating with Healing Arts.
The day after that, on Aug. 19, Ms. Dyer was attacked.
She spent the next two months at the burn unit of NewYork-Presbyterian Hospital/Weill Cornell Medical Center. But she continued to run Healing Arts from her second day in the hospital, Mr. Russo said, meeting with forensic accountants even though her eyelids were sewn shut, and fielding calls from colleagues.
More troubles surfaced, Mr. Russo said. Healing Arts, it turned out, was paying workers’ compensation premiums based on a payroll of $5.5 million, more than the charity’s entire budget. A company ledger showed a discrepancy of $480,000 that was noted simply as a “payment adjustment.”
While Ms. Dyer mended, the police and the Queens district attorney’s office labored to piece together the criminal case and tracked Ms. Williams, who was spending time in Florida.
In December, Ms. Dyer viewed a photo lineup and identified Jerry Mohammed, a 32-year-old from Troy, N.Y., with a record of drug-dealing convictions, as her assailant. Surveillance video taken the day of the attack shows him getting into a Mercedes belonging to Ms. Louallen, the police said.
On April 4, Mr. Mohammed and Ms. Louallen were arrested.
Ms. Williams fled, prosecutors said, but at 8:57 p.m. she was arrested behind the wheel of a white 2010 Mercedes E350 at a rest area on the New Jersey Turnpike. She was charged with two counts of first-degree assault, two counts of conspiracy, two counts of grand larceny, weapons possession, falsifying business records and 48 counts of identity theft. She is being held without bail and faces up to 25 years in prison.
Mr. Mohammed is charged with assault, conspiracy and weapons possession and also faces up to 25 years. Ms. Louallen is charged with grand larceny and conspiracy and faces up to 15 years.
Mr. Mohammed’s lawyer, Michael D. Siff, said on Wednesday that Ms. Dyer had picked someone other than his client at an in-person lineup in Queens on April 12. The district attorney’s office declined to comment.
Today, Ms. Dyer’s face is a pinkened map of scar tissue. One eye is red-rimmed and runs continuously. The other opens only partially, beneath an imperfectly restored eyelid. But she is back at work.
And Healing Arts continues its mission to bring cultural medicine to the sick and the injured. Ms. Dyer knows something of this firsthand.
Last September, as Ms. Dyer lay in her hospital bed, a folk singer named Kathy Lord, one of Healing Arts’s contractors, entered the room.
“I’ve seen a lot of things over the years, and that was probably just about as bad as it gets,” said Ms. Lord, who runs a nonprofit called Music That Heals.
“I said, ‘Alexandra, here I am, Music That Heals,’” Ms. Lord recalled. Knowing of Ms. Dyer’s faith, she sang the country gospel song “One Day at a Time.”
“One day at a time, sweet Jesus,” it goes. “That’s all I’m asking from you. / Just give me the strength / To do every day / What I have to do.”
Tears ran down Ms. Dyer’s ravaged face.
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