The Washington Monthly reports that funding authorized under the 1990 Ryan White CARE Act to provide assistance to AIDS sufferers has helped spawn a culture of fraud and mismanagement among AIDS service providers nationwide. Most of the abuses were uncovered by journalists, community activists, and state and local agencies, not by federal officials charged with oversight of the $1.7 billion program:

• In Puerto Rico, several officials at the San Juan AIDS Institute were convicted after prosecutors detailed a paper trail of offshore bank accounts, dummy corporations, payments for luxury cars, jet skis, personal maids, and cash payoffs to political benefactors, all using $2.2 million in federal AIDS funds. An official with the Department of Health and Human Services responsible for the program's oversight admitted under oath that his department continually paid millions of dollars to the Institute without ever receiving any financial reports in return.

• The FBI is investigating the Margaret K. Wright clinic of South Dallas, which misspent tens of thousands of federal dollars targeted for poor African American AIDS sufferers. A county audit revealed that shopping sprees to Neiman Marcus, home applicances, and psychic phone calls had all been billed to the program. "The FBI is also investigating allegations that the clinic bought expensive AIDS drugs that remain unaccounted for and applied federal funds toward treatment of patients who might not have existed," reports the Dallas Morning News.

• An employee of Central Florida AIDS Resources was jailed for embezzling more than $500,000 from the group, which he spent on Disney tickets, hotels, and restaurants, his monthly credit card bills often exceeding $25,000.

• The North Carolina State Bureau of Investigation is investigating a group called Drugs and AIDS Prevention Among African Americans after an audit revealed its director skimmed 10 percent from all Medicaid payments to the group. Another $15,380 earmarked for clients' rental assistance was instead written out to his mother. His wife, assistant chief of the state's HIV/STD prevention section, is also being investigated for her role in awarding the group $684,291 between 1993 and 1997.

• In California, a state audit revealed that the Los Angeles County AIDS housing program has allowed a whopping $21.8 million of federal money to accumulate since 1993, unspent despite unmet demand.

• An investigation by the Indianapolis Star revealed that AIDServe, the state's only state-wide AIDS assistance agency, spent hundreds of thousands of federal dollars on their own salaries and other operating costs, while at the same time owing thousands of dollars to clients' landlords, pharmacies, doctors, and dentists, many of whom who are now refusing to provide services to the agency's clients unless paid up front. Another $175,000 raised during a recent AIDS Walk was even seized by a bank to pay for an overdue loan.

  

• The Washington Post exposed a cushy AIDS "conference" held in the Virgin Islands that was supposed to highlight HIV/AIDS in poor, developing areas, but to which no local physicians, public health officials, or patients were invited. Joe O'Neill, head of HHS's HIV/AIDS Bureau responsible for oversight of federal funding convened the conference, encouraging invitees to attend using funds from the Ryan White program. O'Neill attended another conference in Rio de Janeiro (between the beaches of Ipanema and Copacabana) and then flew to London in time for Christmas shopping. (East coast AIDS service workers have come to refer to an annual San Francisco conference as "spring break.")

• While pleading poverty on behalf of their programs, many administrators draw hefty salaries far in excess of local mayors, governors, and congressional members. Pat Christen of the San Francisco AIDS Foundation makes $200,000 a year, and Craig Shniderman of the Food and Friends service provider in the District of Columbia makes $163,111 annually. The Washington City Paper reports that after the well-paid director of one D.C. AIDS clinic resigned to become a city council member, which entailed a substantial pay cut, the clinic awarded him a $70,000 consulting contract and even donated a roomful of designer Stickley office furniture because he didn't like his new government-issued desk. (The same clinic has a waiting list for its services.)

• AIDS service agencies have increasingly turned into bloated bureaucracies. San Francisco's Bay Area Reporter wrote about one AIDS patient suffering from chronic diarrhea who was told to contact case workers and fill out a series of forms upon leaving San Francisco General Hospital for treatment—all to obtain an adult diaper that cost less than a dollar. Instead he rode home on a bus, soaked in his own excrement. The excess of red tape has even led to a new occupational class. In order to gain access to "Case Managers" who dispense funding for services, clients now increasingly rely on "Access Advocates" to assist them in navigating the bureaucratic maze.

• While AIDS patients in many states are on waiting lists under the federal Drug Assistance Program, San Francisco's AIDS Health Project used part of its $977,701 in Ryan White grants to hold flirting classes and bowling nights. New York's Gay Men's Health Crisis, apparently not in crisis mode, held hair styling and art classes.

• The New York Post reports that the city's AIDS support office, which budgets $180,000 a week to shelter about 200 homeless AIDS patients, rented a block of 20 rooms at a four-star hotel at $329 per night, greatly annoying other guests.

• Cutthroat competition for funding among AIDS service providers has led some to direct their federal grant money to hire lobbying firms to advocate for increased funding. The formula that governs distribution of funds counts the cumulative number of AIDS cases within a jurisdiction rather than its current caseload. As a result, San Francisco, which experienced a high death toll early in the epidemic, receives twice the funds per patient than other cities with comparable caseloads such as Chicago or Washington, D.C. General Accounting Office Assistant Director Jerry Fastrup told a congressional hearing: "The U.S. taxpayer has been funding health services for dead people."

[Ed.: The Inspector General of HHS reported in November that AIDS prevention funds earmarked for the Stop AIDS Project of San Francisco had been directed towards workshops that encourage sexual activity, explore taboos, and meet the legal definition of obscenity. These included the "Great Sex Workshop," "Booty Call," and "Leatherf***." In February, the group also used federal funds to sponsor "Guywatch: Blow by Blow," whose advertising read, in part: "What tricks do you want to share to make your man tremble with delight?"]

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