SHAW: Guardians Foundation has reported a key employee to the police for theft

An employee of the Guardians Foundation, the operator of Spokane's newest homeless shelter, has been accused of stealing upwards of hundreds of thousands of dollars from the organization that contracts with the city of Spokane.

City Council members have called for a criminal investigation, saying they've heard reports of money stolen ranging from $100,000 to $1 million. Guardians Foundation CEO Mike Shaw wouldn't confirm the amount stolen, but confirmed the alleged theft.

"We self-reported a possible theft by a key employee," Shaw says. "We initiated the investigation in-house. We determined that it was enough evidence to file a police report."

The police were notified on September 29. Shaw says he hasn't heard back about whether "there's enough evidence to file criminal charges." He says he does not recall when he informed the city.
In a press release, City Council members Lori Kinnear and Karen Stratton called for a criminal investigation.

“Because of different funding sources, this could potentially become a federal investigation,” Kinnear said in a statement. “This is why we’re adamant about receiving information via a criminal investigation. The City of Spokane is already in a fragile homeless situation; to add fraudulent activity weakens our progression and frankly is unacceptable.”

Shaw says the revelation came about because of his organization's annual audit.

"When things don’t look right, things don’t look right," Shaw says. "When you confront the individual in charge of making things right, and they confess to their malfeasance it’s pretty simple."

Shaw would not officially identify the employee, only confirming that she had been a key member of the Guardian's administrative staff, and that he wishes her "the best of luck for her future."  (The Inlander has confirmed the identity of the employee but are waiting to identify her until speaking with her. We reached out to the employee to ask her for comment but did not immediately hear back Monday.)
A statement from Mayor Nadine Woodward said that she "has ordered an internal audit of invoices submitted to the City by the Guardians and payments made to the organization. That fact-finding inquiry is underway and the City will provide any evidence of irregularities to law enforcement.

Shaw declined to divulge any details about the nature of the theft or precisely how it was flagged, saying that the investigation was ongoing. He said he would share more details when he was able to.

For now, however, he stressed that there was no additional money owed to employees or to other vendors, but there was a "debt out there" that would have to be accounted for.

"We’re as hurt about the situation as anyone," Shaw says. "Our focus is the 160 people outside our doors."

While only a few dozen homeless people were staying in the Trent Resource and Assistance Center shelter during the first few days, the numbers have rapidly increased since. Shaw says that the average has increased to 140 to 150 people out of nearly 250 available beds. He says there has been no interruption in shelter services.
This isn't the first time that an embezzlement allegation has created headaches for the homeless shelter system provider system. Before the mayoral election in 2019, news broke that the co-founder of Jewels Helping Hands, Jason Green, had spent nearly two years in prison for embezzling from his former food service employer. Similarly, Green's partner, Julie Garcia, had been accused of trying to steal from a 96-year-old man when she worked for a home health care agency, though the case was ultimately dropped because of Garcia's "chronic medical issues." Garcia has denied any wrongdoing.

But Shaw, who once sued Jewels Helping Hands for defamation due to unsubstantiated allegations that they had leveled against the Guardians, rejected any comparison. The Guardians Foundation, he insisted, "did everything by the book."

"To even put Jewels Helping Hands and the Guardians Foundation in the same sentence is still a travesty," Shaw says. "There is not an organization or business on the planet that has not gone through a weird financial anomaly."

But GuideStar, a website that monitors non-profits, reports that "this organization's exempt status was automatically revoked by the IRS for failure to file a Form 990, 990-EZ, 990-N, or 990-PF for 3 consecutive years. Further investigation and due diligence are warranted."

Similarly, the Washington Secretary of State's office sent a letter to the Guardians Foundation this year warning them that they have not filed their required annual report.