Six employes of the D.C. Department of Employment Services have been added to the list of agency officials who were aware that contracts ordered by Ivanhoe Donaldson violated department regulations but did not intercede to halt them, according to a sentencing memo filed by prosecutors in U.S. District Court.
The addition of the six officials to four named last month in Donaldson's schemes completes federal prosecutors' portrait of an agency corrupted by Donaldson while he was its acting director and still under his sway after he went on to become deputy mayor and, later, a vice president for E.F. Hutton & Co.
Donaldson pleaded guilty last month to charges of interstate transportation of fraudulently obtained funds, tax fraud and obstruction of justice. He is scheduled to be sentenced Monday by U.S. District Judge Gerhard A. Gesell, and could face up to 23 years in prison and $360,000 in fines.
No one except Donaldson has been charged in the case or accused of criminal activity.
The six officials named Thursday were Cornelius Haynes, a grants management supervisor; Francis Yates, associate director for the office of management, information and data systems; Alonzo Liggins, a computer specialist; Melford Brown, a supervisory contract specialist; Willie Collins, a financial controls officer, and Edward Meyers, assistant director of the program planning and research.
Mayor Marion Barry, responding in the last month to questions about problems in the agency, has declined to say whether he plans to take disciplinary action against any Employment Services employes, saying he awaits the conclusion of an ongoing federal grand jury investigation.
City Council member Charlene Drew Jarvis (D-Ward 4), who heads the committee on housing and economic development which has oversight responsibility for the agency, said the mayor had told her he would issue a report to her on the matter on Tuesday.
Donaldson's attorneys, in a memo also filed Thursday, said Donaldson made substantial improvements in operations while he was director of Employment Services, including gains in the summer jobs program and unemployment compensation payments.
The six officials' involvement in the case centered on two contracts manipulated by Donaldson -- a $20,000 adjustment in a contract held by International Business Services (IBS) and a $65,000 contract given to Cornbread Givens, president of the Poor People's Development Foundation.
Yates gave written approval for the $20,000 adjustment, which was funneled unwittingly by IBS to Donaldson, even though Yates knew that vouchers and supporting documents were missing and the price of the contract was suppoosed to be fixed.
"He explained to the grand jury that, while he did have concerns about what was taking place, it was a direct request from Employment Services Director Matthew Shannon , and he was in no position to overrule or question the actions of the director," the memo stated.
Prosecutors previously have said Shannon admitted ordering the modification at the request of Donaldson, who was deputy mayor at the time.
In addition to Shannon, Employment Services officials previously implicated in court papers are James George, deputy director for finance; Lillian Manson-Neal, associate director for contracts; and Sandra Hill, who is now an assistant to the public works director.
Liggins, an aide to Yates who was under orders to modify the IBS contract, thought the change was "a bunch of crap" but made it because he was ordered to do so, prosecutors asserted in the memo.
Haynes, former associate director for contracts, said the $20,000 adjustment was highly unusual, but "having obligations," he allowed it to pass for fear of losing his job.
Haynes also told the grand jury he acceded to pressure in early 1984 to approve the $65,000 Givens contract, in which most of the funds ultimately were channeled to Donaldson.
Collins and Meyers also were aware of irregularities in the Givens contract, according to the memo. Collins told the grand jury he approved it because George had approved it. Meyers, though he thought the deal was "kind of a fake," said he decided to "just let it ride" when his objections were met with stiff resistance from Manson-Neal, the memo stated.
Meyers, a longtime Barry aide who served on the board of Givens' foundation at that time but who has since resigned from it, said yesterday he had believed that the money received by Givens' community organizaton would "be translated into good actions."
Brown, who drew up the contract, told the grand jury he had misgivings, but "I just had to go ahead and do what they wanted done."
The memo also confirmed reports that Donaldson retained substantial control over the department even after he had become a Hutton executive in November 1983. "His not being a part of government did not lessen his influence or his ability to get things done in District government," Shannon testified before the grand jury.
Shannon, who declined comment yesterday, also told the panel that Donaldson had used Curtis McClinton, the present deputy mayor for economic development who succeeded Donaldson, to order the $65,000 Givens contract.