Over the past five years, Sen. Doug McCrory helped to award more than $15 million in state grants to the Blue Hills Civic Association, a prominent 60-year-old community nonprofit that served part of his district in the north end of Hartford. But he used that organization as a means to distribute millions of dollars to other local nonprofits and businesses of his choosing, with little or no oversight over how they were spending that money, according to internal records and a newly released forensic audit conducted by the accounting firm of CliftonLarsonAllen LLP. “Available documentation and email correspondence indicate that funding allocations were largely determined by Senator McCrory, with BHCA executing disbursements without consistent adherence to required procedures such as obtaining signed MOUs or projected budgets prior to payment,” the audit reported. One of the largest beneficiaries of that spending was an organization operated by Sonserae Cicero, a local business and nonprofit leader whose relationship with McCrory is now being investigated by the FBI and a federal grand jury.  Records obtained by the Connecticut Mirror and reviewed by the auditors show Vicki Gallon-Clark, the former director of the Blue Hills Civic Association, followed McCrory’s instructions about how the money should be spent and what organizations to fund.  Over a roughly two-year period, Gallon-Clark directed more than $1.7 million — more than 10% of the money Blue Hills received from the state — to Cicero’s businesses, according to the audit. Gallon-Clark declined to comment when reporters visited her home earlier this month. And McCrory, who is preparing to run for another term in the Connecticut Senate, did not return multiple phone calls and emails for this story.  But the forensic audit, which was commissioned by the state Department of Economic and Community Development, concluded that many of the services Cicero was paid to perform during that period were never completed. And auditors reported that Blue Hills officials did little to oversee her work. In 2022 and 2023, the Blue Hills Civic Association directly awarded Cicero’s business, which operates under the name SHEBA, more than half a million dollars that was supposed to go toward consulting services, including reviewing the Blue Hills Civic Association’s policies, leading management training sessions and starting a paid internship program, the audit reported.  But in some cases, the audit reported, there was “no evidence” that programs she’d been paid for had actually taken place. “Ms. Cicero reported dedicating 50 hours to training board directors for a total of $14,000,” the audit states. “No evidence was found to substantiate the claim that Ms. Cicero performed or facilitated board training during this period … Board members confirmed to CLA that they did not receive training in any format.” “The disbursement activity between BHCA and SHEBA Consulting, as well as directly to Ms. Cicero, reveals a troubling pattern of financial mismanagement, potential fraud, and a complete breakdown of internal controls,” the auditors wrote.  “Over $1.7 million in public funds were distributed based on invoices and budget claims that lack substantiation and supporting documentation,” they added. “”Numerous line items … were either grossly exaggerated or entirely unsupported by evidence.” Internal records from Blue Hills also show that the leaders of the nonprofit sent more than $600,000 directly to Cicero’s business in 2023, and they orchestrated another payment of $615,000 in 2024.  For that second transaction, McCrory directed Blue Hills Civic Association to arrange a “passthrough” that would allow the BHCA to avoid contracting with Cicero’s company directly, according to the audit. That plan called for the Blue Hills Civic Association to transfer $1.5 million to another local nonprofit, the Upper Albany Neighborhood Collaborative, which subsequently signed a contract with Cicero, giving her the additional $615,000.  By that point, state officials had been warned of a potential conflict of interest between McCrory and Cicero. And at least one member of the Blue Hills Civic Association’s board had raised concerns about the amount of money the nonprofit was giving to Cicero, according to The Hartford Courant.  Because the money was routed through Blue Hills and the Upper Albany Neighborhood Collaborative, the state had no way of knowing the final recipient of the money. Government transparency measures like the State Comptroller’s Open Checkbook website didn’t register the payments to SHEBA or any of the other businesses and nonprofits that received grants from Blue Hills.  Emails and other records show that state officials had little to no idea what organizations the Blue Hills Civic Association was forwarding funding to until early 2025, just before the nonprofit reported that $300,000 of the state financial aid had been stolen through a fraudulent wire transfer.  Around that time, employees at DECD remarked on the “ton of money” that the Blue Hills Civic Association received with McCrory’s help. They also noted that Blue Hills was subgranting huge sums of money — though they didn’t have records of what organizations the cash was flowing to.  “Blue Hills Civic Association is a small but mighty organization which received over $15 million dollars in the last couple of years,” Jennifer Haag, a DECD employee, wrote in February 2025. “There have been questions on how the money has been given out to subrecipients … the final reporting we ask for is not that detailed.”  DECD officially ordered the forensic audit of Blue Hills Civic Association last spring, after the nonprofit’s leaders told state officials about the $300,000 being sent to the wrong bank account.  Blue Hills staff failed to report that event to the state for several months, though they did inform McCrory, who advised them not to share the information with the state before an FBI investigative report on the matter was received, according to the audit.  “The rationale for BHCA’s delayed disclosure to DECD remains unclear, despite repeated indications that such notification was warranted. Clifton Larson Allen was also unable to determine the rationale for informing Senator McCrory prior to DECD,” the audit said. While the audit primarily focuses on Blue Hills, it also makes several recommendations for how DECD can improve its monitoring of state grants and determine when nonprofits are subgranting money to other organizations.  “DECD must establish clear expectations for monitoring by requiring the primary recipient to maintain accurate records and oversee its subrecipients,” the audit said.  Recommendations for DECD include risk‑based monitoring during the grant year rather than relying solely on year‑end reporting and requiring earlier and more detailed subrecipient reporting, including proof of executed contracts before any money is disbursed to other organizations.  In a press release included with the release of the forensic audit, DECD officials said they are directing Clifton Larson Allen to expand the forensic audit even further in the coming months by reviewing all of the organizations that received money from the Blue Hills Civic Association.  State officials said that report will also be shared once it is completed. In the meantime, DECD said any state funds that were previously intended for the Blue Hills Civic Association would remain frozen.  The nonprofit laid off nearly all of its staff last spring after that funding freeze was initially put in place.  “The allegations of fraud and misappropriation of public funds set forth in the audit do not permit the agency to continue such funding without additional due diligence,” they wrote.  “This forensic audit is a strong reminder that when taxpayer dollars are involved, we have zero tolerance for fraud, waste, or mismanagement,” said Gov. Ned Lamont in the press release. “The findings at Blue Hills Civic Association are deeply troubling and underscore why we need stronger guardrails around legislatively directed funding.” ...read more read less