Minneapolis Nonprofit Operator Charged In $1M Federal Fraud Scheme
BY MN CRIME STAFF
Federal prosecutors have charged a Minneapolis nonprofit operator, alleging he took part in a grant fraud scheme that caused more than $1 million in losses to government agencies and private funders.
A grand jury returned an indictment alleging the operation relied on falsified grant applications, fabricated progress reports, and inflated claims about youth programming that never took place.
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The allegations focused on work done through Encouraging Leaders, a Minneapolis nonprofit, during a period between December 2021 and October 2022. Prosecutors say money awarded to the organization for community programs was instead diverted for personal use by those running the scheme.
Tony Terrell Robinson, the operations director at Encouraging Leaders, is accused of conspiring with the nonprofit’s founder, Tezzaree El-Amin Champion, to prepare and submit fraudulent documents to agencies that had awarded the organization grants for youth services, classroom support and community programs. According to the indictment, the reports Robinson helped prepare claimed the organization carried out various events, provided services to students and organized activities that either did not happen or were significantly overstated. The reports were sent to multiple agencies including the U.S. Department of Justice, the Minnesota State Arts Board and a Minneapolis-based nonprofit supported by the McKnight Foundation. Prosecutors say some grant reports were drafted with the help of a freelance worker based overseas.
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The indictment outlined several specific examples of how the misrepresentation worked. In one instance, Robinson allegedly instructed a contractor to copy and paste language from an earlier grant application into a new document for the U.S. Department of Justice with updates that prosecutors say were false. In others, he is accused of preparing reports describing meetings with students that never occurred and claiming services had been delivered under a grant when they had not.
Authorities say Robinson and Champion coordinated on efforts to secure new funding as well, including the submission of applications and progress reports that prosecutors say were fraudulent. The indictment also lists four transfers in 2022 totaling roughly $78,000 that moved through financial institutions in Minnesota and Pennsylvania as part of the scheme. Federal prosecutors say the total loss tied to the conduct exceeded $1 million.
Champion pleaded guilty earlier this year and was sentenced in November to seven years in federal prison. In his case, the judge described the fraud’s scale as “disturbing.” Robinson made his first federal court appearance Monday on the new indictment charging him with conspiracy and four counts of wire fraud. Each count carries potential prison time upon conviction.
Investigators involved in the case include federal postal inspectors, IRS criminal investigators, state agents and Minneapolis police.
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