Attorney General Maura Healey has issued court orders to two nonprofit charities to compel them to produce documents and submit to interviews about cut-rate prices and favorable terms they offered to a Roxbury real estate dealer and possibly others.
The orders, granted by a Superior Court judge last Friday and delivered over the past few days, went to Veterans Benefits Clearinghouse Development and Roxbury Action Program,which focus on affordable housing, as well as to banks and property management companies with whom they do business.
The charities were featured prominently in a Boston Globe series earlier this month about a family-run business, led by Rolando Pam, that has been linked to numerous property scams in Roxbury and Dorchester. The second of the two parts focused on the two nonprofits, and a number of questionable deals they made with Pam and two of his sons. In one instance, Veterans Benefits sold one of its properties, assessed at close to $200,000, for as low as $100.
The heads of the nonprofits previously declined to speak to the Globe to explain why they would enter into such deals, which may have sacrificed about $1 million in revenue for their missions. They did not respond to further requests for comment on Monday.
The orders, which are similar to subpoenas, were delivered in the past few days. They will allow Healey to take testimony from any officer of the nonprofits, though so far only Harold Raymond of Milton, president of Veterans Benefits, was specifically askedto appear for a deposition before investigators.
In the court documents, Healey said she has reason to believe that both charities entered into — or had plans to engage in — “one or more real property transfers with for-profit entities in which the public charity’’ did not or would not “receive the fair-market value of the asset being transferred.’’
“When a public charity sells an asset, its board generally has a fiduciary responsibility to obtain fair-market value for the asset. Transferring assets for significantly less than fair-market value may constitute a breach of fiduciary duty,’’ said the attorney general.
In one case detailed in the Globe series, Veterans Benefits sold a former Lynn sanctuary to Rolando’s son, Tyler, for $75,000, even though it was assessed at $764,400. Tyler almost immediately resold the structure for $600,000.
The attorney general’s investigation is being handled by the attorney general’s public charities’ division. The division is charged with reviewing, among other things, mandatory yearly filings in which charities must reveal any self-dealing within the organization or any financial payouts to individuals associated with the nonprofit.
In its investigation of Veterans Benefits, the attorney general is also seeking information from Santander Bank, Mt. Washington Bank, Blue Hills Bank, United Housing Management, and Sentry Property Management. In its probe of Roxbury Action, the office asked for information from One United Bank and United Housing Management.
Healey’s office has asked the charities to produce, among other things, all audits, financial statements, conflict-of-interest policies, and related party transactions. Meanwhile, the banks are being asked to produce documents about all accounts and transfers related to the nonprofit; and the property management companies are being asked to show all contracts, among other documents.
The attorney general’s office said it has the right to go to court and seek additional information from other parties, as its investigation unfolds.
Healey’s spokeswoman, Emily Snyder, did not say why the top officers of Roxbury Action were not specifically named in these orders, while Raymond, the president of Veterans Benefits, was singled out. Lloyd King, the cofounder of Roxbury Action and its most recent past president, was cited in the Globe series for entering into a contract with Rolando Pam to sell 11 triple-deckers in Roxbury’s Fort Hill area that had been owned by the nonprofit. The deal would have required state approval; however, it was kept secret from authorities and contained terms that enabled Pam to receive a cut of the profits.
King’s attorney has previously told the Globe that King is old and in poor health, and suggested that Rolando Pam manipulated an ailing man who has contributed significantly to the poor in his community.
Last Thursday, one of Rolando Pam’s other sons, Kyle, was arraigned in Suffolk Superior Court for allegedly scamming an elderly Mattapan woman out of her home, then leaving her at a homeless shelter. His father, Rolando, was at his son’s side in court, and later reiterated to the Globe that his family’s real estate business is honorable.
Both Veterans Benefits and Roxbury Action have a lengthy history of providing low-income housing in Boston’s poorest communities, going back at least several decades. In the past decade, however, their leadership has been less active; many of its questionable sales involved some of their last holdings, or properties they had given up trying to renovate.
Patricia Wen can be reached at patricia.wen@globe.com.
