Alianza Dominicana: The Fall of an Iconic Institution

Moisés Pérez (l.), ex-CEO of Alianza Dominicana, in a City Hall event with Rep. Charles Rangel (r.) (Photo by Azi Paybarah via Flickr, Creative Commons License).

Founded in 1985, Alianza Dominicana was a leading Dominican organization, but now its six-story glass building, one of the fanciest in Washington Heights, is empty. An extensive report by The Uptowner‘s Alvaro Guzmán Bastida sheds light into the organization’s demise.

Alianza Dominicana, it turns out, is in tatters, the subject of an investigation by the New York State Attorney General’s Office.  Its former leaders, including co-founder and CEO Moisés Pérez, allegedly mismanaged the organization’s funds, practiced self-dealing and failed to remit workers’ contributions to their pension funds, among other charges in two reports by the city’s Department of Investigation.

In 2010, with a $15 million budget, it says it served 22,000 families in Washington Heights, providing alcoholism and drug treatment programs, supporting victims of domestic violence and helping elderly residents and schoolchildren with special needs.  It employed more than 350 people and was planning the construction of this building, which cost $30 million.

Two years later, Alianza has collapsed as city and state investigations, and a series of New York Post stories, led to government grants being withheld, intensifying the organization’s financial crises.

Alianza Dominicana’s $30 million building sits empty two years after its construction. (Photo by Álvaro Guzmán Bastida, via The Uptowner).

According to the article, a 2007 report by the City’s Department of Investigation found evidence of “self-dealing.” Pérez and two other members of Alianza’s executive board “invested personal funds in a ‘loan fund’ investment created and promoted by Moorland,” a company with no previous experience in running nonprofit financial operations, which was owned by Alianza’s board member Leving Soriano.

Rafael Lantigua, one of Alianza’s co-founders, was the only board member who felt lending money to Moorland and making interest was unethical, and perhaps illegal, the report states.

“The deal,” Lantigua told the Uptowner, “was you lend money to Moorland, Moorland lends to Alianza, and then we make interest that Alianza should make.” Alianza was experiencing major financial problems and “couldn’t pay its workers” at the time, Lantigua said, so he refused to take part and tried to convince other board members to at least consult a lawyer before proceeding with the investment scheme.

The report also alleges mismanagement. From 2001 through 2008, the years leading to Moorland’s deal, Alianza failed several times to meet its payroll.

The report also quotes Pérez saying that Alianza “was disallowed certain payments and reimbursements,” which investigators described as “double billing” and attributed to incompetence.  Alianza, the DOI goes on, failed to report to the city the full scope of its problem, thus gaining lucrative contracts it didn’t deserve.

DOI questioned Moorland’s suitability as a manager of Alianza’s finances.

For instance, it highlights the outsourcing of some services to the Dominican Republic, including the preparation of all city invoices. Such outsourcing, done with Pérez’s approval, made it “impossible” to examine Alianza’s finances, the report said, citing “lack of records” and the difficulty of determining what was done in the Dominican Republic.

DOI also points out that Pérez lied twice on the yearly so-called VENDEX Vendor Questionnaire required by the city: In March 2010, he said neither Alianza nor any of its members had been investigated by any federal, state or local regulatory agencies, though the investigations were already underway.

Pérez failed to mention the fact that his wife was on the Columbia University payroll  – she worked as a community liaison there from 2000 through 2008 – and was also an Alianza employee while Columbia had a subcontract agreement with Alianza.

But other problems arose. In its second report on Alianza, in July 2011, the DOI examined a complicated pension scheme Alianza launched in 2004.  The report quotes an anonymous worker explaining that the organization offered him and other employees participation in a pension plan.

Alianza would deduct $25 from their salaries, which would go into a pension fund operated by the insurance company AXA. The contribution later rose to $50. AXA sent representatives to encourage workers to sign up, and about 113 agreed to the plan.

But, the report shows, some of that money never went into AXA’s fund.

A court order from March 2011 ruled that Pérez had to leave Alianza permanently – he had already taken a leave of absence after the 2010 report – but the state has brought no charges against him.

One of Pérez’s biggest defenders is veteran Harlem Congressman Charles Rangel.

“You would think that if the allegations were true, there would be a series of indictments,” said Rangel. “Nobody has been charged.”

Rangel, whom Pérez once called “a father to me,” hired Pérez shortly after his resignation from Alianza to run his successful campaign against State Sen. Adriano Espaillat in the July Democratic primary.

Pérez was the fifth biggest contributor to Rangel’s reelection campaign in 2011-2012, and the $34,333 he gave made him Rangel’s largest individual donor.

In the article, Rangel accused the New York Post, which ran a series of stories in 2010 and 2011 discussing the congressman’s ties with Alianza, of “bringing down” both Pérez and Alianza for no reason. As for the DOI reports, Rangel said that the city and the Attorney General’s office made it “really clear” to him that there was no ongoing investigation of Alianza.

However, Rangel acknowledged that the allegations were “very serious” and asked The Uptowner to email him the DOI reports and said he would call back with further responses, which he didn’t.

The past few months have seen efforts to resuscitate Alianza. Several sources, including Rangel and Lantigua, confirmed that in October, shortly before Hurricane Sandy, city and state officials met with Dominican leaders, representatives from Catholic charities, Espaillat and Rangel to discuss reviving the organization.

The meeting went well, recalled Lantigua, who attended, but political attention soon shifted to storm recovery, and little progress has been made since.


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