The former head of a New Orleans nonprofit organization faces federal prison time after pleading guilty to embezzling tens of thousands of dollars in public grant money.
Marcia Peterson, who served as executive director of CDC 58:12, a community development group, admitted Wednesday to stealing nearly $25,000 from the U.S. Department of Education and more than $62,000 from the Department of Housing and Urban Development.
Peterson, 61, of Gretna, used at least some of the stolen funds to fuel her gambling addiction, court records show. She also admitted to falsifying claims for unemployment benefits from the Louisiana Workforce Commission.
A plea deal signed Wednesday offered new details about the thefts.
CDC 58:12, a group ostensibly working to rebuild the Upper 9th Ward, had an agreement through the Louisiana Department of Education, under a federal program known as 21st Century Community Learning Centers, to provide “educational services through the creation and use of a community learning center in Orleans Parish,” according to court documents.
“These 21st Century funds were the primary source of income to CDC’s bank account during this time,” court records say. “Peterson routinely submitted documentation to LDOE to justify expenditures of 21st Century funds and represented that all funds were properly spent.”
But Peterson actually had been stealing program dollars by withdrawing funds from the nonprofit’s bank account “for gambling and other personal purposes.”
Peterson’s group also received federal dollars through the Housing Authority of New Orleans to provide social services to families in The Estates, a low-income housing complex formerly known as Desire. She similarly embezzled thousands of dollars through her organization’s contract with HANO and the city of New Orleans through the federal Community Development Block Grant program.
HANO’s former chief, David Gilmore, confirmed last week that he terminated HANO’s contract with Peterson’s group last year after he learned she was under federal investigation.
A spokeswoman for U.S. Attorney Kenneth Polite said Wednesday that Peterson faces a maximum prison term of 20 years for wire fraud and up to 10 years for each of two counts of theft of government funds.
Peterson is scheduled to be sentenced Dec. 17 by U.S. District Judge Martin Feldman.
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