Ex-director pleads guilty in $138,700 theft of nonprofit

The former executive director of a city nonprofit that provides social services and education to gay and lesbian residents of color pleaded guilty in federal district court yesterday to stealing more than $138,700 from The COLOURS Organization Inc.

Authorities said Dorena Kearney, 45, of Lindenwold, N.J., opened up four credit card accounts and obtained lines of credit from some area banks.

The accounts were opened in her name and in the name of COLOURS, court papers said. Kearney opened the accounts without the knowledge or approval of the organization's board, court papers said.

Kearney then used the credit cards to make numerous personal expenditures between June 2004 and June 2007. (Although funded by the Philadelphia Health Department, COLOURS received more than $1 million in federal funds during the three-year period.)

U.S. District Judge Anita Brody set sentencing for Oct. 12. Under advisory-sentencing guidelines, Kearney could face up to 18 months behind bars.

Kearney was released on $50,000 personal-recognizance bail, ordered to undergo mental health treatment and restricted from traveling outside New Jersey and eastern Pennsylvania.

According to the government's plea memorandum, Kearney took a leave of absence from her executive director position in 2007. Her acting supervisors discovered she had used credit cards in both her name and the name of COLOURS to make numerous personal expenditures.

Officials said those purchases included clothing, shoes, jewelry, cruises, groceries, gasoline, dining, cable-TV service, home repair, furniture, pet food, legal fees and even cosmetic surgery.

Kearney used COLOURS' funds to pay the credit card bills, the government's plea memorandum said.

"There's no excuse for her conduct," said defense attorney Joseph P. Capone. "However, she is very remorseful and contrite."

Kearney was charged following a joint investigation by the city's Inspector General's Office and the FBI.

The investigation stemmed from a new partnership between the city, the U.S. Attorney's Office and the FBI to crack down on municipal corruption.

Amy Kurland, the city's inspector general, is a former federal prosecutor. *