Recently, a corruption scandal has been uncovered in the Brooklyn shelter system, with the non-profit organization BHRAGS Home Care Corp. being accused of embezzling public funds and engaging in kickback transactions, as the federal investigation continues. According to New York City budget records and media investigations, New York City Council member Farah Louis has been implicated in directing over $450,000 of discretionary city funds to the said non-profit organization over the past five fiscal years.
An examination of dozens of city council budget documents by Gothamist found that from the fiscal year 2021 to 2025, Louis consistently applied for funding for BHRAGS each year, making her one of the most steadfast supporters of the organization within the City Council.
Data shows that during this period, the City Council provided over $500,000 in funding to BHRAGS, with the majority allocated at Louis’ request. These funds primarily came from the “Speaker’s Initiatives” fund controlled by the Speaker’s Office, which allows council members to apply for allocations beyond their individual quotas.
In addition, Louis continued to support the organization through small grants ranging from $1,000 to $15,000 and funding from the Brooklyn delegation, including for food pantries and community service programs.
Since her election in 2019, Louis has secured over $10 million in discretionary funding for hundreds of organizations in her district and other areas, covering legal aid, elderly care, art groups, public health initiatives, and immigration services. From the relevant records, BHRAGS is among the organizations that received the highest amount of funding.
The federal investigation has escalated the situation. Law enforcement officers raided Louis’ residence in Brooklyn and her sister’s residence (her sister serves as an aide to the governor) at the end of March and seized electronic devices.
This action is related to the investigation into BHRAGS. The organization’s Executive Director Roberto Samedy and former Board Chair Jean Ronald Tirelus have been indicted for allegedly embezzling over $1.3 million.
According to the search warrant, Louis and her sister have not been formally charged, but prosecutors are investigating whether they facilitated bribery or kickback arrangements in assistance to a security company associated with BHRAGS in obtaining contracts.
A spokesperson for the City Council stated that during the federal investigation, BHRAGS will no longer receive any new City Council funding, and no significant irregularities were found in past review processes. Louis’ office has not responded to media inquiries.
In addition to council appropriations, since 2022, the City of New York has provided approximately $130 million in emergency contracts to BHRAGS through the Department of Homeless Services. The organization also secured a housing contract worth up to $94 million in 2025, its largest collaboration project to date, set to take effect in July this year.
However, the city government has not clarified whether it will proceed with the contract amid the ongoing investigation.
New York City Council members are able to support non-profit organizations directly through discretionary funding without public bidding, but the process requires legal review, qualification pre-screening, and reimbursement mechanisms to mitigate misuse risks.
Despite reforms made to the system following the “ghost organizations” scandal in 2008, where millions were allocated by the Council Speaker to non-existent groups, and a further reduction of the Speaker’s control over fund distribution in 2014 to equalize distribution and provide additional resources to impoverished districts, experts believe there are still loopholes in the system.
Susan Lerner, the Executive Director of Common Cause NY, pointed out that the system could still be abused: “Discretionary funding is essential for supporting small community projects, but it continues to raise questions about whether allocation is unduly influenced.”
In simple terms, she said: “When do elected officials allocating resources turn into favors or even become another form of ‘sweet deals’? We have not yet found a perfect solution to this issue.”
Gothamist’s investigation reveals that Louis also allocated a significant amount of discretionary city funds to other non-profit organizations. Through the “Speaker’s Initiatives,” in the fiscal year 2026, she secured $600,000 for a small water activities non-profit organization called Inclusive Community Wellness Inc. This amount is significantly higher than their previous grants (only $5,000 in fiscal year 2024) and approximately four times their recent reported annual income.
The grant was initially described in budget documents for literacy programs, homeless prevention, food assistance, immigrant services, and mental health projects. However, a budget amendment nine months later revised the purpose to “increase accessibility to community swimming instruction.” The organization has not received payment from the city government, and the relevant department confirmed that the contract is still under registration.
Inclusive Community Wellness stated that the funding was proposed in line with the mayor’s initiative to expand citywide swimming programs and plans to collaborate with two other water sports non-profit organizations, but has not specified the exact allocation method. According to City Council regulations, subcontracting amounts must not exceed 30% of the total, and prior approval from the city government is required.