Erie County Legislator Frank Todaro is requesting State Attorney General Letitia James to investigate the finances of the Seneca-Babcock Community Association, after various reports indicate the organization has not complied with state and federal law for financial reporting for nonprofit organizations. The SBCA is an organization that serves at risk youth and senior citizens and operates several facilities across the city.
“There are gaps of several years, where there is no filing of financial reports. Nonprofit organizations are required by law to register and file these reports annually. An independent audit uncovered that accounting records for the organization have not been maintained. That is deeply troubling and leads to more questions about how money is being spent,” said Legislator Frank Todaro.
Records indicate the SBCA regularly filed annual financial reports, as required by law, through 2004. However, the next filing did not occur until 2020, and that was for the 2017 tax year. There are no other filings with the State Attorney General’s Office to date. In addition, federal law requires the SBCA to file an annual IRS Form 990. It’s been noted that the organization did meet this requirement through 2015. However, the next filing wasn’t submitted until March 2019 for the 2016 tax year. The organization then waited until November 2020 to file for the 2017 tax year. The failure to file these reports as required could mean the organization would then not be recognized as a nonprofit/tax-exempt organization by the State of New York, which would mean it has been improperly soliciting donations and accepting government grants.
Independent Auditor Bonadio & Co, LLP noted a rare “Basis for Disclaimer of Opinion,” in which they stated “detailed accounting records have not been maintained and supporting data was not available to complete the audit, with the exception of cash. Therefore, we were not able to obtain sufficient appropriate audit evidence about the amounts reported in the accompanying statement of financial position and the related statement of activities and changes in net assets and cash flows for the year ended December 31, 2017.”
“I am concerned that this goes beyond a simple paperwork error. The Executive Director is aware of the requirements, and I question whether they deliberately chose not to comply,” said Legislator Todaro.
Legislator Todaro is requesting the State Attorney General investigate financial statements, records, and nonprofit status of the Seneca Babcock Community Association for potential fraud, waste, abuse, theft and mismanagement of taxpayer dollars.
