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Photo illustration: 731; Photos: Penn: Chris Pizzello/AP Photo; Textures: Alamy
(4)
Businessweek
The Big Take


SEAN PENN’S DISASTER-RELIEF CHARITY ENDED UP A MONEY MESS

CORE saved American lives during the pandemic. Employees say it has also failed
to shield them from alleged sexual harassment or address financial
mismanagement.

By

Sophie Alexander

+Follow
February 1, 2023 at 5:01 AM GMT


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Sean Penn didn’t have to do any of this. His biggest supporters and detractors
can agree on that. A little over a year ago, his party at Soho Beach House, a
private club in Miami Beach, was the hottest event at Art Basel, the annual
international fair. The beachfront venue was packed with around 200 of the
actor-turned-activist’s friends and acquaintances, including Leonardo DiCaprio,
pop star Anitta and Delphine Arnault, heir to the biggest fortune on Earth.
Later in the evening, Anitta sang Girl From Rio, and a charity auction raffled
off NFTs and an Andy Warhol sketch. All told, the party raised $1.6 million for
Penn’s nonprofit, CORE Response, that invitations and promotional materials said
was earmarked for its Covid relief efforts in Latin America. A CORE employee
involved in the fundraising says Anitta hosted the event on the condition that
some of the money would go to her home country of Brazil, the only place in the
region where CORE had any Covid relief programs of note around that time. The
backdrop for the event was a massive map showing where CORE promised to put the
money to use.

Besides being a fundraiser, this was a sort of victory lap for Penn’s nonprofit.
During the pandemic, CORE transformed with incredible speed from a
Caribbean-focused disaster relief charity with around a dozen employees into the
de facto Covid response team for Los Angeles. It raised close to $200 million;
put 3,000-plus people on its payroll, more employees than the Bill & Melinda
Gates Foundation; and co-ran the testing site at Dodger Stadium, among the
largest in the US. Through the pandemic’s darkest days, CORE administered
millions of tests and vaccines and saved lives. When the delta variant ebbed, it
wound down much of its ground-level staffing in Los Angeles and other US cities
and started looking for new challenges. The Latin America fundraiser shows how
it has struggled to find clear new footing and stick to it.

CORE didn’t direct any of its Art Basel haul to the region until almost six
months later, according to internal documents viewed by Bloomberg Businessweek.
During staff conference calls, Chief Executive Officer Ann Lee, who runs CORE’s
day-to-day operations, repeatedly said the nonprofit could use the funds for
other projects instead, according to three employees on the calls. (Like most of
the 38 current and former employees Businessweek interviewed for this story,
they spoke on condition of anonymity because they’ve signed confidentiality
agreements, because they’re afraid of retaliation or both.) Current and former
employees say they had to spend months pushing their bosses to send the money as
promised before Chief Operating Officer Jérôme Lebleu sent an email outlining
how it would be used in Brazil. In a September interview, Chief Business Officer
Matt O’Connell said the money raised at Art Basel went to work on Covid response
in Rio de Janeiro. But internal documents show that CORE shut down its last Rio
vaccine sites the day before the fundraiser.


Lee and Penn at the Soho Beach House fundraiser for Covid relief.
Photographer: Cindy Ord/Getty Images

Asked for clarification, a CORE spokesperson said in a statement that the money
raised at the Art Basel event was sent to its intended destinations throughout
the region. But the COO’s email shows that of the $1 million netted from the
event, CORE dedicated none directly to Covid relief. Instead, it appropriated
$750,000 for a broader range of spending in Brazil, including $90,000 to pay its
only employee there and $400,000 for unspecified “programs,” and kept $250,000
to cover overhead and indirect costs. “We are revising our plans for Brazil in
line with our desire to conserve cash,” Lebleu wrote. This was well short of the
$1.6 million pledged at the party because of the event expenses and because
several pledged donors, including DiCaprio, hadn’t paid up, according to a 2022
internal spreadsheet and an employee who was tasked with collecting the money as
recently as September. A DiCaprio representative says he paid the $50,000 he
pledged, but wouldn’t say when. A spokesperson for Anitta didn’t respond to
requests for comment.

The dozens of current and former employees say the gaps between CORE’s stated
goals and its actions stretch much further. Businessweek’s investigation shows
that CORE has left aid shipments sitting unclaimed for days or returned to the
donor because no one was there to handle them; frustrated partners with lax
ground-level work and loose management of multimillion-dollar federal grants;
and omitted certain information about how it spends its money on its tax forms.
CORE is on its fourth finance chief since 2020. Its latest available financial
audit, conducted on its 2020 finances by accounting firm Windes Inc., found
seven areas of concern. Employees also say that allegations of sexual battery
and harassment by CORE staff and partners have gone unaddressed, and that many
who’ve spoken out have faced retaliation. Several have filed employment
lawsuits. Since September, CORE’s lawyers have repeatedly delayed a trial date
with the National Labor Relations Board, over a Penn email that the agency
claims threatened employees who publicly criticized working conditions.

CORE, which declined to make Penn, Lebleu or Lee available for an interview,
said in its statement that the NLRB complaint is “overzealous and ill-advised,”
adding that “CORE stands by every word in Mr. Penn’s email.” O’Connell, the
chief business officer, says CORE has adequately addressed all sexual misconduct
claims, and he denies the employee allegations that it has mishandled donor
funds. But he acknowledges that the operation grew too fast and had trouble
managing its finances. “Some of our management systems at the beginning of the
pandemic were insufficient in scope and scale to meet all our organizational
needs,” O’Connell said in a four-page written response to Businessweek’s
questions about the audit. “Admittedly, there were inefficiencies and errors.”



During the September interview, O’Connell said he was unaware of the audit’s
findings but that what matters most are CORE’s contributions to its central
missions. “The most important thing to our leadership, to Sean and Ann, is that
we respond to the pandemic,” said O’Connell, a former Peace Corps volunteer
who’d been an orthodontics technology executive before joining CORE full time in
2020. “The urgency of the pandemic didn’t allow for the months of an
implementation of systems that can handle an organization this large.” These
problems, he said, are now solved.

Yet CORE staffers say the nonprofit is continuing to mismanage funds and ignore
or minimize employee complaints. A current employee says executives are using
the nonprofit’s money to pay for a range of inappropriate expenses, from
needlessly lavish dinners and hotel rooms to traffic tickets, and that in a
recent meeting Lee told the team to lighten up on the expense rules. (CORE
denied that Lee said this and stressed that its expense policies follow
government guidelines.) “It’s just the same garbage,” says Sam Hilsman, who quit
as CORE’s director of technology in September, partly because, he says,
leadership ignored his concerns about related financial issues. “There’s
email-based invoice approvals. There’s just stuff that isn’t appropriate for an
organization of this size after this long. I tried to explain this to them two
years ago.”

“They stood on the outskirts of our efforts with their video cameras and filmed
what we were doing as if it was them”

Hilsman and other current and former employees say CORE’s leadership team spends
more time worrying about its press than its management. (To take one example,
CORE, which said in its statement that it’s proud of its work, has also
acknowledged it sought to learn more about the details of this article from
sources it directed to Businessweek.) Some recent nonprofit partners say much
the same.

As the organization has expanded into hurricane-stricken Florida and Puerto Rico
as well as into Ukraine, its first active war zone, CORE is continuing to
aggressively raise funds without necessarily delivering meaningful aid,
according to employees and local partners. “They stood on the outskirts of our
efforts with their video cameras and filmed what we were doing as if it was
them,” says Rob Gaudet, founder of Cajun Navy Ground Force, which worked
alongside CORE in Florida to provide relief in the wake of Hurricane Ian in
October. He says his experience with CORE left him frustrated and feeling taken
advantage of. CORE said it was unaware of this complaint and that the use of
photographers “for an emergency response organization is critical and standard
practice.”

To date, CORE’s ascent to the forefront of disaster relief hasn’t come with a
commensurate level of scrutiny. The issues it has allegedly struggled with
aren’t exactly alien to other US nonprofits, but there’s been little public
review of its massive rise, much of which has been funded by taxpayers as well
as the Art Basel set. Many people, especially residents of Los Angeles, owe
Penn, Lee and CORE a debt for the work they’ve done during Covid. The nonprofit
itself might also owe some people other things, including apologies.

Before he’d won two Oscars, when he was better known for playing Jeff Spicoli
than Harvey Milk, Penn, the son of a director and an actress, was also known as
the guy who’d take a swing at paparazzi and go to jail for punching an extra on
a movie set. He mellowed somewhat in middle age. In 2005 he was one of many
celebrities who traveled to New Orleans in the wake of Hurricane Katrina, where
he helped people escape floodwaters. He was also criticized at the time for
bringing along a professional photographer.

Pre-Covid, his disaster-relief efforts were most closely associated with Haiti.
In January 2010, a 7.0 magnitude earthquake and its aftermath killed hundreds of
thousands of people there. Penn was on the ground soon after, with plans to stay
for only a couple weeks. Months later, he was still there. This was when he and
Bosnian entrepreneur Sanela Diana Jenkins founded the organization that would
become CORE, an acronym for Community Organized Relief Effort. For much of 2010,
Penn was leading, and living in, Haiti’s largest relocation camp. He testified
to the US Senate about the need for more aid and accepted, along with Bill
Clinton and Anderson Cooper, a medal from Haiti’s president. After some said the
aid money would be better spent by an organization with more experience and
fewer camera operators, Penn said in a TV interview that he hoped the critics
would “die screaming of rectal cancer.”


Penn helping unload medical supplies in Port-au-Prince in 2010.
Photographer: Ron Haviv/VII/Redux

In Haiti, Penn also met Lee, a director there for the nonprofit Global
Communities. He hired her as CEO in 2016, the year after a gala called Sean Penn
& Friends Help Haiti Home was attended by Clinton, featured a performance by the
Red Hot Chili Peppers and raised $6 million. With Lee at its helm, the nonprofit
spent several more years operating disaster-relief efforts, mainly in Haiti and
other Caribbean countries. In 2019, Penn made Lee an honorary co-founder and
changed the organization’s name officially to CORE.

By 2019, though, $6 million was just about CORE’s revenue for the whole year. At
that point, according to the nonprofit’s tax forms, it had been losing money for
three straight years, employed 18 people and listed zero volunteers. In its
statement, CORE attributed the decline to waning global interest in Haiti
relief.


Clinton and Penn in 2010. Seated at center is Haiti’s then-president, René
Préval.
Photographer: Ramon Espinosa/AP

All of this makes CORE’s pivot to Covid even more remarkable. For convoluted
political reasons, the City of Los Angeles doesn’t have a public-health
department. Its roughly 4 million residents theoretically have access to the
public-health services provided by Los Angeles County, but that department
serves about 10 million people, including a great many residents of wealthier
suburbs who are good at cutting lines. In the early days of the pandemic, when
personal protective equipment and tests were scarce and many people were still
wiping down their groceries, the city had only a handful of staff doctors at its
disposal and no help from the county in setting up testing sites, says Jeff
Gorell, who was a deputy mayor at the time. Then Penn used his connections to
California Governor Gavin Newsom to make then-Mayor Eric Garcetti an offer.

“Along came Ann Lee and Sean Penn,” says Gorell, a Navy captain and supervisor
of California’s Ventura County. “They said, ‘Let us do it, let us man it and
operate it, and we’ll do it with our own donations.’ ” At first it was one
testing site, then two, then three. By summer, CORE was running sites all over
the city with the Los Angeles Fire Department. Initially, CORE relied on gloved,
masked, hazmat-suited volunteers, but it quickly began hiring them as full-time
employees. Soon they were helping conduct tens of thousands of tests a day at
sites across LA, including en masse drive-thru testing at Dodger Stadium. “It
was a blessing,” Gorell says. “If CORE wasn’t there, the city of LA never
would’ve had testing on the level that it did. There was no Plan B.”

CORE was able to move so quickly in LA, and several other cities, thanks largely
to tech money. Billionaire Jack Dorsey, then the CEO of Twitter Inc. and a Penn
buddy, gave the nonprofit $10 million for Covid aid in May 2020, then an
additional $20 million a month later. This was in keeping with other
philanthropic efforts by Dorsey, who’s also sent money to nonprofits affiliated
with Eminem, Jaden Smith, Jay-Z and Rihanna, but the CORE funding was on a scale
Penn and Lee’s team had never seen. The donations snowballed. After bringing in
$6.6 million in 2019, CORE reported revenue of $76 million in 2020 and $122
million in 2021, according to its latest tax forms.


TOTAL REVENUE





Source: CORE’s most recent tax forms



All told, CORE helped conduct millions of tests, mostly in Los Angeles. When
Covid vaccines became available, it administered millions of those as well, in
LA and several other cities. It was a stunning mobilization of aid, a success
without many clear comparisons.


The line for Covid vaccinations at Dodger Stadium in 2021.
Photographer: Robert Gauthier/Los Angeles Times/Polaris

But the model also had flaws. Private funds for public needs rarely solve
underlying problems, says Hilde Van den Bulck, a Drexel University professor who
wrote a book on celebrity philanthropy. “You have to worry if you have to rely,
as a state, let alone a country, on ad hoc solutions to these kinds of things,”
she says. “It’s not uncommon for celebrity-endorsed organizations to be a bit of
a mess.”

Sarena Serrano was 23 years old when she started at CORE in June 2020. She
initially signed up as a volunteer, but she soon had a full-time job
administering Covid tests at Dodger Stadium with many people in their first jobs
out of college. “It was like a big summer camp for adults,” Serrano says, adding
that she was inspired by having Lee, a woman of color, as her CEO. But the
workplace was also like summer camp in a bad way. Eight CORE staffers at the
stadium say LAFD firefighters working there routinely sexually harassed their
female peers. One says the firefighters called them “CORE whores.” Serrano, in a
lawsuit against CORE and others, says LAFD Chief Jaime Lesinski, who was running
the department’s operations at the stadium, repeatedly sexually battered and
harassed her for months. Other current and former employees, as well as
documents shared with Businessweek, corroborate her allegations.

“I had LA’s battalion chief stroking my ass every time he went by me,” Serrano
says. At other times, she says, echoing allegations in her eventual legal
complaint, he suggested she’d spent the previous night performing sex work. “I
cried every day about it, because I didn’t know what to do,” she says. “I was
scared.”



At the time, the only HR reporting process current and former CORE employees say
they were aware of consisted mainly of an email address and an anonymous, public
Google Forms spreadsheet for run-of-the-mill safety complaints. Serrano says she
reported the incidents to her manager and, after hearing nothing for weeks, told
Lee directly. “I’ll never forget it,” she says. “I was crying to her, telling
her about how Lesinski was groping me in a cubicle, and she goes, ‘Sarena, have
sympathy for me. Think about me and what I’m going through. Lesinski is my
friend. Can you imagine how I feel? I’ve known about this for weeks.’ ” (Another
person who was present confirms this exchange.) About a month later, CORE fired
Serrano in what she alleges was retaliation for speaking out. She has sued CORE
for wrongful termination, Lesinski for sexual battery and gender violence, and
both CORE and LAFD for allowing sexual harassment in the workplace, among other
allegations. Her complaint against CORE is being handled through arbitration.

Lesinski and the LAFD, whose case is ongoing, didn’t respond to requests for
comment. CORE said in its statement that after Serrano’s conversation with Lee,
“prompt action was taken to remove Lesinski from the site and an investigation
was commenced.” (Lesinski, who remains an active LAFD battalion chief, is now
running a fire station near LA’s Eagle Rock neighborhood.) Once management was
alerted to the alleged culture of harassment at Dodger Stadium, CORE said, “it
took appropriate remedial measures.”

But two other CORE stadium workers, one of them a manager, say Lee and COO
Lebleu knew these problems were ongoing and did nothing for more than a month.
Not knowing where else to turn, one emailed Lebleu in July raising concerns
about sexual harassment at the stadium, according to a copy of the email viewed
by Businessweek. This person followed up that August in another email seen by
Businessweek, saying the situation had worsened. That month, after someone wrote
in sharpie in an on-site port-a-potty that one of CORE’s own managers, who
current and former employees say was sexually harassing staff, “doesn’t like
women,” Lee visited the stadium. Several employees say that in a staff meeting,
she defended the site leaders, including Lesinski, and argued that CORE
employees should be grateful for the ways she was looking out for them. These
employees say she focused on the free food and coffee.

Soon after, a new complaint landed in the anonymous Google spreadsheet, where
multiple submissions also alleged Lesinski was sexually harassing staff. “You
have effectively said ‘We don’t believe you,’ ” the complainant wrote, according
to a copy of the spreadsheet viewed by Businessweek. “Free coffee is NOT the
answer.”


Directing traffic at Dodger Stadium in 2020.
Photographer: Marcio Jose Sanchez/AP

By then, CORE had begun expanding its operations to more than 20 locations,
including Atlanta, Chicago and New Orleans, and winning tens of millions of
dollars in federal grants to repeat its Dodger Stadium success. What CORE wasn’t
doing was setting up the kinds of rigorous accounting processes typical of an
operation spending tens of millions of taxpayer dollars a year, according to
several current and former employees, some of whom have served in leadership
roles at peer institutions. Federal grants come with much stricter reporting
requirements than donations from billionaire friends. CORE was using Excel
spreadsheets for its roughly 2,000-person payroll and the small-business
software QuickBooks for its accounting. In fact, as of September, it was still
using QuickBooks, according to O’Connell, the chief business officer. “It’s not
ideal,” he said in the interview. “You make it work.”

O’Connell acknowledges that CORE’s 2020 financial processes needed an overhaul.
In reviewing its finances for that year, the firm Windes found that CORE was
missing financial documentation and basic oversight of its payroll and expenses.
None of Windes’s seven points of concern was material enough to lead to
repercussions, but taken together, they start to look a little dizzying: tens of
thousands of dollars of expenses not accounted for; hundreds of thousands in
expenses misclassified; hundreds of thousands recorded under the wrong year;
missing payroll approvals and donation documents; miscalculations in accrued
vacation time; and missing grant documentation from, separately, the Treasury
and Health & Human Services departments. “That’s a lot of findings,” says
Stefanie Cohn, a partner at accounting firm Marcum LLP in Washington, DC, who
reviewed CORE’s audit at Businessweek’s request. “On a bad client, I have four
or five.” In addition, internal financial documents viewed by Businessweek show
that CORE didn’t list its largest fundraiser on its 2020 or 2021 tax forms, and
that its official top vendors for 2020 don’t quite match its own records,
either.

CORE didn’t answer a question about those internal discrepancies. O’Connell says
he took over the finances that fall and made sure all the money was accounted
for, though he added: “I’ve never worked in a company that’s been shipshape.”



Yet CORE’s finances have remained “structurally unsound,” according to a former
employee who left last year after being hired to help address some of these
problems. The person oversaw grants from the US Health Resources and Services
Administration and says the tracking of payroll and expenses was consistently
messy. According to two people familiar with the matter, the nonprofit Partners
in Health, which was administering a multimillion-dollar federal grant given to
CORE, repeatedly warned via emails that CORE’s financial reporting was
unacceptable. Partners in Health no longer works with CORE, in part because of
this experience, one of these people says. A Partners in Health spokesperson
declined to comment. CORE noted in its statement that, ultimately, “all of
CORE’s financial and programmatic reports were reviewed and accepted by PIH.”

A year after O’Connell says he reformed CORE’s accounting practices, toward the
end of 2021, an employee named Elvis Ramirez had to repeatedly tell CORE to stop
paying him months after he’d left the organization. “I had to reach out multiple
times, and they never got back to me,” Ramirez says. The parties have now set up
a payment plan for him to return the money. “That’s a huge issue,” says Cohn.
“I’m sure that for every employee that reported that they were getting paid and
not working there, there’s probably two that didn’t.” CORE said in its statement
that what happened with Ramirez isn’t a widespread issue.

Hilsman, the former CORE employee who quit this past September, says he also
noticed financial discrepancies on his team, which was creating an app. He says
in his last few weeks there he noticed random travel expenses attributed to his
team, including rental car bookings in various cities, and that his questions to
his manager about the expenses were met with silence. “Where did all that money
go?” he asks. CORE said it “reviews each program’s profit-and-loss statement
monthly to ensure accuracy.”


Lee at a Covid testing site in LA in 2020.
Photographer: Chris Pizzello/AP

Current and former employees say the common denominator is Lee, who makes the
vast majority of the nonprofit’s operating decisions, including selecting which
disasters to respond to, how long to stay in the area and who does what. While
Penn remains chair of the board, they say he has little role in CORE’s
day-to-day work. Lee has said CORE owes its high profile to Penn’s fame, for
better or worse. “One of the things that I struggle with is our visibility
because of Sean,” she told staff during a recent organizationwide conference
call, according to a recording of the call heard by Businessweek. “We get access
to so much publicity and visibility. We can go on CNN, and it really raises the
profile of our organization.” The catch, she said: “We also get very undue sort
of scrutiny.” In October, according to a copy of a presentation seen by
Businessweek, CORE staffers met with a consultant to discuss how to brand the
charity without relying on Penn.

Starting in 2021, after the parking lot of Dodger Stadium was returned to the
Dodgers, CORE wound down most of its testing and vaccination sites and began
laying off employees. In the return-to-office era, the nonprofit had a bit of an
identity crisis, and current and former employees who were there at the time say
it seemed under pressure to figure out what was next.

In September 2021, images circulated on social media of US border patrol
officers chasing down on horseback some of the thousands of Haitian migrants in
and around Del Rio, Texas, who were fleeing the aftermath of an earthquake. Lee
retweeted a couple of those posts and dispatched vans full of employees to Del
Rio. The idea was to hand out a few hundred toiletries kits and administer Covid
tests and vaccines to refugees as they crossed the border, according to two
people who were involved in relief efforts there. But CORE’s team wasn’t allowed
to conduct any Covid testing or vaccinations in Texas, one of these people says,
because nobody coordinated the required labs or state approvals. Current and
former employees say that while the trip was considered a failure internally,
CORE left with photos and videos that made it seem like a success. CORE didn’t
comment on why the team didn’t perform tests or vaccines.

No humanitarian aid group is perfect, and the Del Rio fiasco could be
interpreted as a one-off mistake. But employees, and those at other nonprofits,
say incidents like this one have become more common as CORE has shifted its
attention away from the pandemic. Ever since then, employees say, CORE has
repeatedly arrived at the site of a humanitarian crisis with little planning,
taken photos to boost its profile and raise money, then moved on. CORE
reiterated that it’s proud of its work.



After Hurricane Fiona devastated Puerto Rico in September, CORE sent a single
employee to the island and hired a local consultant to assist her, according to
Laura Domenech, a CORE partner at Ponce Health Sciences University in Puerto
Rico, and another person familiar with the situation. Meanwhile, it kept
fundraising. By early October, CORE had raised at least $200,000 in cash for
Fiona response, according to an internal document viewed by Businessweek, plus
dozens of boxes of such supplies as solar-powered lanterns, according to
Domenech and the other person. By the time the supplies arrived, though, the
sole official CORE employee in Puerto Rico had flown to Florida to respond to
Hurricane Ian, so CORE asked Domenech to help receive and store the supplies.
Domenech says the shipment sat unclaimed for about a week. CORE said it
prioritizes local hiring and that it collected and delivered the items as soon
as possible.

In Florida, the story was much the same, says Cajun Navy’s Gaudet and another
person familiar with CORE’s work there. In the city of Fort Myers, Gaudet’s team
set up a camp in a Big Lots parking lot where CORE operated for a time. In
October, a donated shipment of batteries and other supplies worth tens of
thousands of dollars arrived there, but nobody was waiting for it, because CORE
had relocated to a different spot after the supplies had been shipped. No one
took inventory, and part of the shipment was returned to sender. CORE said
taking inventory would have unduly delayed the distribution of the supplies and
that it worked with the shipper, Amazon.com Inc., to make sure the rest of the
supplies eventually made it to the new location.

Lately, one of CORE’s biggest fundraising successes has been its response to the
war in Ukraine. Penn’s timing was uncanny: The day Russia invaded, he has said,
he was with Ukrainian President Volodymyr Zelenskiy, shooting a documentary for
Vice. The following week, Penn was on CNN with Anderson Cooper, talking about
his relationship with Zelenskiy and CORE’s work in the region. “We’re
distributing hygiene kits, we’re giving cash assistance, water to refugees as
they come through,” he said. “We need assistance with CORE. We’ve never been
very good at getting on the media front.” That media blitz, which also included
appearances on MSNBC and Fox, led to millions raised from individuals online
alone, according to an employee working on CORE’s grants team at the time.


Penn and Zelenskiy in November.
Photographer: Ukrainian Presidential Press Office/UPI/Shutterstock

But here, too, CORE’s deployment of resources hasn’t been anything like its
Covid mobilization, according to three employees who’ve worked either directly
in Ukraine or at one of its staging areas in Poland or Romania. One, who was
involved in the early response, says CORE first went to Poland with a handful of
people, including two professional photographers, and little planning. Two of
the people say safety was given short shrift and that even basic security
protocols, such as buddy system check-ins, were lax. CORE said it’s “deeply
committed” to staff safety and works to mitigate risks.

Jan Luc Willaert, who started with CORE as an LA volunteer during Covid and is
now running all its Ukraine relief efforts, says his team of about 20 people
ensures employees are safe with help from local partners. He says that while
CORE has never technically operated in a war zone before, places like
post-earthquake Haiti trained many longtime staffers to deal with extreme danger
and stress.

It’s unclear, though, just how many longtime staffers CORE has. Total headcount
now stands in the hundreds, a fraction of its peak, and employees say every
nonmanagement job carries some degree of precarity. In Los Angeles, a handful of
employees were laid off this past summer even though CORE had just received a
million-dollar grant from the Elevance Health Foundation that should have
guaranteed their jobs for two years. Hilsman and two other people familiar with
the layoffs say the staffers were offered their jobs back at lower salaries than
what Elevance had guaranteed and refused to take the pay cuts. O’Connell denies
this, saying the team was laid off because CORE wanted different people in those
jobs. A spokesperson for Elevance declined to comment on whether it was aware of
CORE’s staffing changes.

In September, Lee held what some employees now call the “snitches get stitches”
staff meeting

Apart from the finance chief, one of the few constants at CORE is the
leadership. Penn is still the best-known face of the organization, and Lee is
still CEO. The seven-person board of directors remains mostly Penn and his
circle, including his agent Bryan Lourd, filmmaker Fernando Sulichin and
actresses Patricia Velásquez and Soleil Moon Frye. In its statement, CORE said a
question about the board’s makeup suggested “disrespectful dismissiveness” of
entertainers.

Many former employees are trying to move on with their lives after CORE,
describing their experiences as traumatic. Some say the stress of working for
CORE led them to lose unhealthy amounts of weight or take medical leaves. Some
current and former employees say they’re frustrated that there’s been no
accountability for the management team’s blunders, and that they feel like their
good intentions and hard work have been taken advantage of to make Lee and Penn
look good. One former employee sent a letter to the California attorney general
last year saying they have concerns about the nonprofit’s use of grants,
according to a copy of the letter shared with Businessweek.

In California the attorney general has “very broad authority” to make sure
charities are serving the public benefit, says Eric Gorovitz, a nonprofit
attorney at the law firm Adler & Colvin in San Francisco. Speaking generally, he
says things like misuse of donor funds could warrant an investigation. At the
very least, says Cohn, the Marcum auditor, CORE’s management needs “to take a
step back and get the right controls in place.” The attorney general’s office
declined to comment, saying it’s unable to discuss complaints it has received.

In September, following early reporting by Businessweek, Lee held what some
employees now call the “snitches get stitches” staff meeting. She told the
gathering that talking about the nonprofit with outsiders was “just not cool,”
and that staying quiet is part of their contracts, which is only true for some
employees. “We did the right thing, and we did it the right way,” Lee says in a
recording of the meeting shared with Businessweek by multiple employees.
“There’s not a moment I regret.” —With Rachel Adams-Heard and Wojciech Moskwa

Tips: Bloomberg News is examining the hidden costs of the nonprofit field and
celebrity charities. Share your story at salexander82@bloomberg.net


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