Employment Program's Ex-Boss Pays $13 Million To Settle Misconduct
By Dave Reynolds, Inclusion Daily Express
December 13, 2006
EL PASO, TEXAS--ReadyOne Industries, last year's largest nonprofit to benefit from a federal program designed to employ workers with disabilities, has settled a lawsuit with its former president over allegations of misconduct and personal use of the organization's money.
According to the El Paso Times and The Oregonian, the organization agreed to receive just $13.3 million -- in the form of investments and interest -- of the more than $30 million that it had originally sought from Robert E. "Bob" Jones.
For more than ten years, Jones ran the organization, then known as the National Center for the Employment of the Disabled, and helped take it from bankruptcy to the point that in 2005 it employed 4,000 workers and received $275 million from the federal government to manufacture such things as chemical warfare protection suits, military uniforms, and cardboard boxes under contracts set aside for workers with disabilities under the 1938 Javits-Wagner-O'Day Act (JWOD).
Jones resigned under pressure in March after the Oregonian reported that he had paid himself as much as $4.5 million a year in management fees while using NCED's assets to finance his own business ventures.
During a four-hour meeting with the nonprofit's attorneys last month, Jones refused to answer 543 questions asked of him, choosing instead to invoke his Fifth Amendment rights against self-incrimination.
The Oregonian also revealed last spring that investigators discovered that the nonprofit could only account for 7.8 percent of its work being performed by employees who were "blind or severely disabled". The JWOD program requires 75 percent of the work to be performed by workers with disabilities. The paper showed that NCED had, among other things, listed an inability to speak English as a disability.
Details of the settlement, in which Jones does not admit any wrongdoing, will be filed in January.
Jones is still the subject of federal fraud and tax evasion investigations.
The U.S. Senate held hearings and investigations into allegations of fraud and corruption of contracts under the JWOD program for more than a year. Senator Edward Kennedy of Massachusetts, incoming chairman of the Senate Health, Education, Labor and Pensions Committee, said last month he would propose bipartisan legislation to tighten regulations under which $2 billion in no-bid set-aside contracts are granted each year to nonprofits.
"Charity for disabled workers to get $13 million from ex-chief" (Oregonian)
"Nonprofit settlement provides $13 million" (El Paso Times)