A scathing audit by Comptroller Brad Lander, a new mayoral candidate, says the company received a massive $432 million no-bid contract from Mayor Adams’ administration to help immigrants, and that immigrants should be forced to return millions of dollars to the city because of questionable payment and billing practices with lax government oversight.
The audit of the city’s emergency contract with the controversial company DocGo examined payments for the first two months of an emergency contract in May and June 2023 for the company to provide hotel rooms, meals and other services to migrants, many of whom are staying in suburban and upstate New York lodging facilities.
A draft report obtained by The Washington Post concluded that the city should recoup 80% of the initial $13.8 million paid to DocGo in the first two months, or about $11 million.
The audit found that payments for lodging, security, meals and other services were overstated, lacked documentation and there was no oversight of subcontractors.
The contract and services were overseen by the city’s Department of Housing Preservation and Development (HPD).
“An examination of paid invoices for May and June 2023 revealed that 80% of the $13.8 million paid to DocGo should not have been paid because the amounts paid were not authorized by the contract or were not sufficiently supported by required documentation. If this error rate were applied to the $168 million paid for services to DocGo as of June 12, 2024, the overpayment could amount to $134.4 million,” the audit report said.
Of the $13.8 million paid, more than $9 million was to DocGo subcontractors that were not pre-approved by HPD, according to the analysis.
Lander’s audit asserts that the company, which transformed from a COVID-19 supplier to a migrant shelter provider, was unqualified to handle the difficult task of catering to thousands of asylum seekers.
“DocGo lacks experience in providing emergency housing of any kind,” the audit said.
The report noted that Adams ignored Lander’s objections to HPD’s contract with DocGo in September 2018. Previous complaints included allegations that DocGo employed unqualified guards and that staff mistreated asylum seekers.
The rigorous investigation was completed just a week after Lander announced his candidacy for mayor, pitting the left-leaning progressive against the moderate incumbent Adams in next June’s Democratic primary.
The unusual situation of a sitting auditor running for re-election to the mayoral race has raised concerns about whether Lander is fulfilling his constitutional duties or using his auditing powers as a political entity to embarrass his rival, Adams, according to sources.
Adams’ office argued that Lander was getting too hung up on details in the midst of a relentless immigration crisis.
“In the midst of an unprecedented international humanitarian crisis, employees across City government were called to act swiftly and decisively to meet this defining moment with compassion and care for others,” the mayor’s spokesman said.
“Mothers needed formula and health workers needed supplies, so we prioritized people’s health over paperwork.”
Adams’ representative continued: “The inspector general can micromanage the first two months of the emergency contract, more than a year after the fact and long after new safeguards have been put in place, but cannot claim that it saved a single migrant family sleeping on the streets.”
“We continue to pay our partners who work tirelessly on behalf of the city, especially during this humanitarian crisis.”
HPD officials acknowledged that they could have handled the DocGo contract better initially, accepting and implementing some of the inspector general’s recommendations while challenging and rejecting others.
The audit found that DocGo and the city paid subcontractors for security at the hotel more than was required by contract.
HPD officials disputed the account of endorsing approval for the extra security, arguing that a memo cited in the audit, written months later, “documented” verbal approval that had been given earlier.
During those two months, the city paid DocGo about $1.7 million for hotel “vacant rooms,” and the company received $408,680 in commission, according to the audit.
HPD also paid DocGo $971,967 to deliver 259,961 meals in May and June 2023, but the audit found that only 160,431 meals were needed given the migrant population at the shelter.
But HPD slammed the report as a political attack by Lander.
“The report grossly misinterprets the HPD memo and fails to acknowledge facts that do not bolster a politically convenient narrative,” HPD spokeswoman Ilana Meyer said.
“HPD officers and their contractors worked around the clock, seven days a week, to ensure safety, shelter and food for the thousands of people who suddenly found themselves on the city’s doorstep. When HPD made quick decisions, they did so with compassion, and when procedures did not yet exist and documentation was not available at the time, HPD made the right decisions rather than risking lives for bureaucratic procedures.”
DocGo defended its performance.
“New York City has been facing a national immigration crisis for two years, and DocGo has helped the City navigate this complex emergency by quickly scaling and funding a large-scale program to rapidly respond to the crisis.
“While the program has faced a highly political environment, DocGo is proud to have served 32,000 asylum seekers throughout the HPD program, and we are also proud to have served asylum seekers in need in our home of New York City,” a DocGo spokesperson said.
“We believe in the quality of our programs.”
