A nonprofit created by Hartford area funeral home director and board member of the Connecticut Minority Business Initiative board has not returned over $770,000 in unspent taxpayer dollars that the organization received through the Blue Hills Civic Association (BHCA) at the direction of Sen. Douglas McCrory, D-Hartford, according to a damning forensic audit released last week.

But a review of the organization’s tax forms also show nearly $1 million in funds were either stolen through wire fraud or were rerouted back to the Blue Hills Civic Association in payments that are unaccounted for in the forensic audit or in the BHCA revenue ledger.

The Prosperity Foundation was created by Funeral Home business owner Howard K. Hill in 2010 and exists to “promote philanthropy, prosperity, and self-empowerment in the Black community,” according to the organization’s website. Hill serves alongside McCrory on the Minority Business Initiative Advisory Council where McCrory used his influence to direct funds not only to his “close associate” Sonserae Cicero, but also to Hill’s foundation.

According to the Department of Economic and Community Development’s (DECD) forensic audit, $15 million in state and federal dollars were routed through BHCA to other nonprofit groups with little to no oversight. The audit revealed “pervasive governance failures, systemic internal control weaknesses, and patterns of conduct that strongly suggest potential fraud and misappropriation of public funds by BHCA and related parties.”

While much of the focus has been on McCrory and the millions funneled to the Society for Human Engagement and Business Alignment (SHEBA) run by Cicero, with whom he allegedly has a romantic relationship, the forensic audit also found The Prosperity Foundation had received $1.1 million through the BHCA in 2024 but could only account for spending $328,124, “leaving $771,876 in unspent funds,” that were not returned. 

“The final report submitted to DECD by BHCA indicated that The Prosperity Foundation retained an unspent balance of $450,000,” the auditors from CliftonLarsonAllen wrote. “However, this figure is inconsistent with the communications and documentation found in the BHCA email archives, which reference an underspend amounting to $771,876.00. The report to DECD also states that a formal plan is in place for The Prosperity Foundation to address their unspent funds; however, no documentation was identified to substantiate this claim.”

The Prosperity Foundation also reported wildly increased spending for grant writing and management, accounting, and marketing during that time period, with nothing submitted to support those increases, according to the audit.

“The Prosperity Foundation did not provide BHCA with documentation to substantiate any of these increased expenses, nor do the available records indicate that BHCA questioned or attempted to validate the basis for these revisions,” CliftonLarsonAllen auditors wrote. “Further, CLA did not observe any unspent funds being returned to BHCA. In the absence of supporting records, CLA was unable to verify how these funds were used or whether the reported expenditures were allowable, reasonable, or actually incurred.”

A review of The Prosperity Foundation’s 990 tax reports shows it experienced a nearly ten-fold increase in revenue between 2020 and 2024, that the organization lost more than $500,000 in a wire fraud scam in 2023 and funneled hundreds of thousands of dollars back to BHCA in 2024 that was not documented in the forensic audit.

The Prosperity Foundation grew from $329,249 in revenue in 2020 to $2.7 million by fiscal year 2024, with nearly all of their 2024 revenue coming from government funds. The Prosperity Foundation then dispersed $2.2 million to other organizations including $486,000 to the Blue Hills Civic Association to “advance their nonprofit vision and mission,” according to the organization’s FY 2024 990 tax filing – a massive payment that does not appear in BHCA’s revenue ledger provided in the forensic audit. 

According to the forensic audit, Prosperity only awarded BHCA $60,000 during fiscal year 2024, and half of that money does not appear to have been received. But there is no mention or apparent documentation of the $486,000 in grant funds that Prosperity reportedly sent back to BHCA. The ledger of grant revenue to BHCA for FY2024 says nothing about receiving money from the Prosperity Foundation, and auditors only found reference to the $60,000 payment in emails.

“Additionally, email review also indicated that BHCA received $60,000 in grant funds from TPF which were not included in BHCA’s reported total grant revenues of $7.6 million,” the auditors wrote. “The award letter indicates the funds would be distributed in two payments; $30,000 on November 30, 2024, and $30,000 on May 15, 2024. However, communications indicate BHCA did not appear aware of what happened to the second $30,000 payment.”

It was the same year that BHCA granted the Prosperity Foundation $1.1 million, of which $771,000 has not been returned. An additional $3.5 million was made available to the organization through the state’s Community Investment Fund, according to the audit. 

The Prosperity Foundation in FY 2023 also saw $500,000 lost through wire transfer fraud, similar to the $300,000 fraud loss that shuttered BHCA, during a year in which the organization indicates it received $550,000 from the government. The state’s open records website indicates the organization received $1 million in pass through grants for 2023. 

“The $900,000 was stolen and the New Haven Police and Connecticut FBI were called,” the 990 states. “After investigation and tracing the funds, $399,155 in funds were recovered resulting in a loss on theft of over $500,845. These funds are not expected to be recovered. The Prosperity Foundation does not have an obligation to pay back for these lost funds.” 

According to the 2023 audit that was only just submitted to the Office of Policy and Management in 2025, “the Foundation communicated this matter with the funder and they do not expect repayment on any of the funds lost on theft.”

The OPM audit indicated that nearly half of the Foundation’s revenue that year came from the Social Equity Council’s Community Reinvestment Grant program that uses tax revenue from the state’s legal cannabis industry to provide grants to community organizations. The audit also found weaknesses in internal control and financial reporting. Some of those weaknesses included unsupported payments using government grant money.

“The Foundation’s charges to state awards for salaries and wages are not supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and that reasonable reflect the total activity for which the employee is compensated,” the Foundations own audit report stated. “The basis for allocating costs to state awards is unsupported by documentation.”

The Foundation responded that it had experienced a loss of employees and was working to strengthen its reporting system.

Both Hill and McCrory pushed for the Minority Business Initiative Advisory Council to award funds to The Prosperity Foundation during a May 2022 meeting, with McCrory arguing that Prosperity would simply be passing the money to other organizations. “All that institution is gonna do is do what we want done,” McCrory said, according to the transcripts. “That’s it. They don’t have any decision making. They don’t have any policy making. They have nothing.”

The forensic audit highlighted that BHCA was being used as pass through entity to send money to other organizations at McCrory’s discretion, including a chess club that was run by a BHCA employee. It was during the same May 2022 meeting that McCrory advocated for $350,000 to be sent to the SHEBA owned by his “close associate” Sonserae Cicero.

The audit found hundreds of thousands of dollars in suspected fraud, charged by SHEBA to BHCA for work that never appears to have been done, internship programs that appear to have not existed, and using a $50,000 scholarship fund to write checks, including a $5,000 payment to Maurice Morgan II, a board member and employee of SHEBA.

The U.S. Department of Justic subpoenaed the DECD over the summer of 2025 seeking documents regarding BHCA, SHEBA, HEDCO, Girls for Technology, the Upper Albany Neighborhood Collaborative, the YMCA of Greater Hartford, KTH Advisors and The Prosperity Foundation. The subpoena also sought communications between nonprofit leaders and DECD officials, and “all documents concerning any personal or non-professional relationship between Douglas McCrory and Sonserae Cicero-Hamlin.”

Subpoenas are orders to produce documentation or testimony and signals a grand jury investigation but does not constitute allegations or charges of wrongdoing.

McCrory issued a statement after the audit was released claiming that he has not engaged in any wrong-doing and supports putting accountability measures in place for nonprofit awards. Despite the results of the audit and the controversy surrounding him, Senate Democrats indicated they will not be removing McCrory from his leadership positions, despite pressure from Gov. Ned Lamont and Republicans.

Hill responded to Inside Investigator’s questions with “no comment.”

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