Accounting Policies For Non-profits

Living high on the VA's money

When Nancy Cook dined out, she used a debit card to cover the tab.

When she paid her personal cell phone bill, she used the same card.

When she withdrew cash, she used it again.

The only problem is that the card wasn't hers. It drew from a taxpayer-funded account used to pay bills for homeless veterans at the North Charleston shelter Cook then managed as its executive director.

Some expenses were for the legitimate benefit of the center and the veterans.

Others -- clothing and antiques at high-end King Street boutiques, pricey meals at fine restaurants, rent at her private-practice office -- were questionable. Cook even used the Good Neighbor Center's account to pay her personal federal withholding tax.

For more than 15 years, Cook had managed the 32-bed Spruill Avenue shelter where homeless veterans sought help finding work, obtaining permanent housing and overcoming alcohol and drug addiction.

Officials at the U.S. Department of Veterans Affairs, the primary source of the grant money that bankrolled Cook's lifestyle, did nothing to stop her spending. VA officials conducted annual inspections at the nonprofit shelter, but rarely reported more than minor health or safety violations.

VA inspectors' financial reviews were perfunctory and relied on Cook's documentation.

Cook's management went unchallenged until last fall when The Post and Courier published its first reports detailing problems at the shelter.

Now Cook, a former Charleston County School Board chairwoman, is at the center of a federal investigation.

Auditors said this year that the shelter owes the government more than $122,000 in grant funds that were spent inappropriately. Now they are probing whether Cook broke federal laws.

Cook was fired in May and her access to the shelter's funds has been suspended.

Her attorney, Gregg Meyers, said his client acted only with approval from the shelter's board of directors.

Meyers, who served with Cook on the school board, said context must be considered when reviewing Cook's spending. Even hundreds of dollars in purchases from stores such as Bath and Body Works were justified, he said.

"Room fresheners or candles were purchased … to create a better atmosphere than the shelters would otherwise have," Meyers said in an email.

Tax troubles

Cook did not withhold taxes when she paid herself and an employee in checks from the shelter's account, according to recently released records and interviews with the new board president. She told VA officials that she had, records show.

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