Federal investigators are investigating the business activities that of an Anchorage woman whose charitable organization city donated $1.6 million in the course of the coronavirus pandemic in order to assist those who are homeless or suffering from addiction.
This is according to reports of The Anchorage Daily News and ProPublica which found that the city provided one of the largest grant aids to the pandemic Rosalina Magaeva’s non-profit House of Transformations, despite the state’s investigation of Magaeva for fraud allegations and permanently barring her from being an Medicaid provider a few years prior.
Anchorage Daily News reporter Kyle Hopkins wrote about the whole thing recently, and then was joined by Alaska News Nightly host Casey Grove to discuss it.
Listen:
The transcript below has been lightly edited to improve clarity.
Kyle Hopkins: House of Transformations is a charity that you can go to and stay, as it were after you have been released of jail or have to wait for trials. It’s essentially a halfway home and, in addition is a location that you could theoretically receive treatment for addiction and, if you choose to go to rehab, and you can be connected to job-training opportunities.
Imagine that it’s 2020, there’s a new non-profit organization that is forming in the near future, and then there’s a flood of cash, federal relief funds and other federal relief funds, to aid nonprofits and businesses fight to stay afloat during the epidemic. In 2021 the city received the first round of about $50 million in aid to be distributed. So, House of Transformations, along with a variety of other local nonprofits and charities were able to request a small portion of the money. And they were granted $1.6 million in funding from the city as part of the so-called ARPA the American Rescue (Plan) Act. known as the American Rescue (Plan) Act.
Casey Grove: So Rosalina Magaeva started the House of Transformations. It’s clear that she’s a key persona here. But who is she? What’s the truth behind the earlier Medicaid fraud accusations?
Kyle Hopkins: Well, this wasn’t somebody I was acquainted with, in all honesty. I had been working on some research on the Anchorage Equal Rights Commission, since there were a lot of complaints coming from city employees. We’ve discussed this before however, as you’re aware city employees were claiming everything from discrimination to harassment in City Hall. One of the agencies that was supposed to investigate the issue of discrimination in this city is that of the Anchorage Equal Rights Commission. Then I tried to become familiar with the new commissioners appointed by them, and Rosalina has been one of the commissioners chosen by the Mayor (Dave) Bronson.
In the past when you Googled Magaeva, one of the most prominent results is a permanent ban from Alaska’s state. Alaska due to the fact that she owned another business called A Loving Care, and which provided personal assistance at home. The business, and later Magaeva herself were disqualified by the state of Alaska from serving as Medicaid providers. That’s quite a quite severe punishment for the state. In fact, she was criminally charged, however they ultimately went the administrative route and prohibiting her company and herself from participating as Medicaid providers. The reason I didn’t include it in the news at the time since it was irrelevant and wasn’t crucial to discuss the reasons why investigators weren’t closing the cases but it didn’t surface again until a while ago I found out that she’s being investigated by the federal government once more.
Casey Grove: So, how do you know if they’re being investigated? Because, as I said there’s been no indictment or any charges have been made public. But I’ve heard that people are talking about it.
Kyle Hopkins: Yes, and to be honest I’m saying that we frequently hear about people being under investigation but aren’t able to get stories on it. The federal government investigate many issues, and often do not lead to indictments. In this case we were aware that I had, for instance, had a conversation with the owner of a company who was approached by an Treasury Department investigator, and possibly some one associated with the Small Business Administration. Remember, this was before the Small Business Administration gave out the PPP loans. They were also asking questions regarding Bitcoin investments, and also about nesting in the same waythat I’ve described as nesting dolls for nonprofits because there’s Magaeva who owns House of Transformations, but then House of Transformations, either the non-profit version or a for profit version, may be the owner of a variety of other corporations, aren’t they? The investigators were truthfully, talking to a number of individuals as part of the investigation, and I believe it was difficult to keep this information private.
Two things have allowed me, based on my experience to publish the incident. The first was when I visited Transformations and they simply declared, “Yeah, we’re being probed.” It’s like they essentially acknowledged that they were being investigated. The other thing was that the city eventually stated, “OK, here’s what we’ve been asked about.” that’s right, “We have heard from the federal authorities, they’re asking questions and here are the companies and entities they’re asking questions about.”
Casey Grove: Are we aware of what they’re investigating for?
Kyle Hopkins: I believe it’s uncertain to speculate the reason they’re being investigated for precisely. We do know that the federal authorities are looking into the federal funds they were awarded. Federal investigators are looking for information similar to the requests that they made, telling, “Here’s what we’re gonna do with these grants.” Therefore, I’m sure they’d be studying what they received, and you can imagine what that money was employed to fund? Right?
Casey Grove: Of course, a major aspect of the issue is whether or not the cityand, in this instance it’s of the Anchorage Assembly — properly scrutinized this non-profit along with its founding. What do the mayor’s office or Anchorage Assembly have to say on this?
Kyle Hopkins: Well, I was struck by the fact that it seemed like it would be a natural thing to come up. It was just like it would pop up. If you were to give more than a million dollars to someone who you’d like to — what I told my editor was, you’d think that the state, or the city would have to check someone out according to the extent (of) that of screening the initial Tinder date. It’s true they’d probably search for the name, and maybe take a look at CourtView. We refer to it as”the “Tinder threshold.” Did they really like the amount of scrutinizing? It doesn’t seem to be the case. Even if it was, then they certainly didn’t inquire about it, did they? This leads to more questions.
Let’s take a look, Rivera served as in charge of the (Assembly) chairman at that time I believe. He declared, “Well, the Assembly does not have enough money to fund the investigator.”
Casey Grove: That’s Felix Rivera, the Assembly chair.
Kyle Hopkins: I’m sure. But I’m not sure. I mean, they appear quite capable of searching things. Therefore it’s something which could be addressed through a policy or some kind of policy that is formal.
Casey Grove: There was a significant amount of federal dollars flowing into the state as you mentioned in the report during the pandemic and also for relief from pandemics. Do you think this, or that one of other groups that we’ll need to discover in the future, was it not thoroughly vetted or came under an investigation?
Kyle Hopkins: Absolutely. I believe that this ARPA funds were a beacon of fraud across the country. It’s been demonstrated. Now we’re seeing examples of people asking questions about the way that this money was distributed and to whom it was distributed and the way they used the money in Alaska. In the end, when I read this kind of reporting it’s like I’m only beginning to look at what’s happening with the federal funds going? Since whenever you look across the board in any direction it doesn’t take time to find something that creates a whole lot of questions. So, I’m convinced there’s plenty more to know about the field.
