PATH Board of Directors Statement on Upcoming Legal Proceedings Related to 2017 Funding Discrepancy
PATH is committed to our mission of ending homelessness for individuals, families, and communities across California. As we work with our supporters to achieve this goal, we want to make you aware of an ongoing legal case regarding an isolated situation that occurred in 2017.
In 2017, PATH was a victim of a fraudulent scheme that diverted resources from a program funded by the Los Angeles Homeless Services Authority (LAHSA). Through our routine monitoring, our team members detected increased spending in the program. PATH acted immediately, placing the staff in question on leave; ceasing all spending and investigating all related transactions; and notifying LAHSA, the Board Officers, and the Homeless Initiative to ensure transparency. At the conclusion of our internal investigation, in partnership with LAHSA, we discovered fraudulent activity and immediately terminated the two employees.
Our organization envisions a world where every person has a home. PATH’s staff members are mission-driven and bring passion, dedication, and empathy to help our community’s most vulnerable members. This one-time situation was not aligned with our values, we brought our findings to the Los Angeles Police Department, pressed charges, and have been fully cooperative in the active investigation. All funds have been repaid.
Although the fraudulent activity was an isolated event, it was important to PATH that we took measures to improve our systems. We created stricter financial controls that included increased checks and balances on all spending and growing our financial compliance team to ensure this never occurs again. PATH also created an anonymous reporting tool for anyone to flag suspected activity. In addition, although we believe in restorative justice, we have a policy that if there is clear evidence that a person takes resources away from those we serve, we will opt to press charges. Since the 2017 incident, PATH has earned and maintained CARF (Commission on Accreditation of Rehabilitation Facilities) accreditations, based on comprehensive evaluations of our programs, infrastructure, capacity, and internal controls. And, most importantly we have had no additional fraudulent activity.
PATH’s role in the community remains as it has been since 1984: to help our unhoused neighbors exit homelessness, achieve stability, reintegrate into the community, and thrive. We are grateful to the Attorney General’s Office for their diligence and helping us advocate for our clients. PATH also thanks LAHSA for its partnership in the investigation and dedication to ensuring the highest quality of programs for the individuals and families we serve.
To our stakeholders, PATH deeply appreciates the tremendous support you have expressed of our thorough response and continued impact in the community. Together, since the 2017 incident, we have helped nearly 8,000 individuals move off the streets and into their own homes. Be assured that PATH will continue fully cooperating with the Attorney General to find justice for our unhoused neighbors.
About PATH
Founded in 1984, PATH is committed to ending homelessness for individuals, families, and communities in California. We do this by building affordable supportive housing and providing homeless services in more than 150 cities across the state. Our services support nearly 20 percent of the state’s population experiencing homelessness. Since 2013, PATH has helped more than 12,800 people move into permanent homes. More information at www.epath.org.
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