The former head of one of the largest operators of homeless shelters in New York pleaded guilty Monday to pocketing hundreds of thousands of dollars in bribes from contractors in a scheme that went on for years, as homelessness in the city grew to record numbers.
Victor Rivera, the founder and former chief executive of the nonprofit Bronx Parent Housing Network, admitted to accepting kickbacks from contractors working with the organization and laundering the money through entities he controlled, according to the city Department of Investigation.
As part of the plea agreement, Mr. Rivera is expected to face a prison sentence and, according to federal court documents, he has agreed to forfeit $1.2 million.
The case marked a steep fall for a man whose power, influence and wealth grew along with the number of people living in the city’s homeless shelters and on the streets. Since 2017, Mr. Rivera’s organization has received more than $274 million in city funding to operate shelters.
He was arrested weeks after a New York Times investigation last year showed he had run the group with near impunity: Ten women, including homeless women and employees, accused him of sexual assault and harassment, while Mr. Rivera also enriched himself with money meant for his nonprofit, The Times found.
Federal prosecutors in Manhattan charged Mr. Rivera in March, saying he had used some of the money to pay the mortgage on his personal home. Mr. Rivera owned a $780,000 home with a heated swimming pool and waterfall in Stony Point, N.Y., and another house in the Poconos.
“Instead of protecting the city-funded nonprofit he once ran, this defendant abused his power, using the nonprofit as a hub for his illicit scheme,” Daniel G. Cort, acting commissioner of the city Department of Investigation, which investigated the case along with federal prosecutors, said in a statement Monday.
Mr. Rivera, 61, is scheduled to be sentenced on May 6 on one count of honest services wire fraud. His recommended sentence under federal guidelines is between three and four years in prison.
“Mr. Rivera accepts full responsibility and is remorseful for his conduct,” said his lawyer, Harlan J. Protass. “He very much looks forward to putting this episode behind him and to rebuilding his life consistent with the public service work he has done for the past 30-plus years.”
The scheme lasted from 2013 to 2020, the authorities said, as Mr. Rivera rose to become a major player in the city’s massive social safety net. In public, he frequently invoked a compelling personal story: He said he grew up poor in the South Bronx, even becoming homeless for a time, and went to prison for drug possession before turning his life around.
He founded the Bronx Parent Housing Network in 2000 on a shoestring budget with members of his church.
But as city money came in, Mr. Rivera’s personal fortune also grew, according to The Times investigation. His salary swelled to $306,000 in 2019, and the organization also leased him a Mercedes-Benz with a custom license plate promoting his charity: BPHN ORG.
He mingled the nonprofit’s finances with for-profit housing companies he owned, steering lucrative contracts to friends and associates and providing jobs to several members of his family, the investigation found.
“Victor Rivera sought to leverage his position as the C.E.O. of a nonprofit into a very much for-profit situation for himself,” Audrey Strauss, then the U.S. attorney in Manhattan, said when the charges were first announced.
A representative for the U.S. attorney’s office did not respond to a request for comment on Monday.
The authorities did not specify which contractors paid Mr. Rivera off, exactly how much money he collected or how he laundered the money. But The Times had reported that Mr. Rivera started a for-profit company in 2011, Community Outreach Consulting Firm, that provided housing for people living with H.I.V. and AIDS. Former employees of the Bronx Parent Housing Network told The Times the firm shared staff and resources with the nonprofit group. When Mr. Rivera stepped down from the consulting company in 2018,his wife, who also worked at the firm, took over.
As homelessness has soared in New York in recent years, the city has entered into contracts with dozens of nonprofit organizations to run shelters and provide services. Last year alone, the city awarded $2.6 billion to these groups. But officials have been reluctant to closely scrutinize the finances of nonprofit groups or to end contracts because the city is so reliant on the organizations.
In October, The Times detailed how other executives personally benefited from the homelessness organizations they ran, including one chief executive who earned more than $1 million a year.
The city Department of Social Services, which oversees homeless shelters, had placed the Bronx Parent Housing Organization on an internal watch list after a whistle-blower at the organization told officials in 2017 that Mr. Rivera had engaged in financial improprieties, including hiring family members.
But the city continued to give the group millions of dollars, and Mr. Rivera found ways to benefit himself and his associates.
The Times found, for instance, that Bronx Parent Housing Network awarded $184,000 in maintenance contracts to a friend of Mr. Rivera who had performed work at a building Mr. Rivera personally owned in the Bronx. Mr. Rivera’s organization also steered millions of dollars in rent payments to a company owned by his onetime business partner.
Mr. Rivera was ousted from his position at the Bronx Parent Housing Network after The Times story was published.
Mr. Rivera had faced another criminal inquiry: The Bronx district attorney’s office opened an investigation into Mr. Rivera following allegations, reported in The Times, of a pattern of sexual misconduct, including assault.
The nonprofit organization paid a combined $175,000 in confidential settlements in 2017 and 2019 to two former employees who accused Mr. Rivera of sexual harassment and assault, records showed. One of them had told the New York police that Mr. Rivera had coerced her into performing oral sex and told her, “Nobody tells daddy no.”
Mr. Rivera has denied any sexual misconduct. A spokeswoman for the Bronx district attorney said the investigation had closed but would not comment on any conclusion or outcome.