Lydia Watts, former chair and founder of Washington Enpowered Against Violence, says the agency is closing because concerns have been raised about possible mismanagement of two grants that the agency has lost. (Ricky Carioti/The Washington Post)

A Northwest Washington nonprofit group that has provided legal and counseling services to domestic violence victims since 1997 announced this week that it will close its doors Friday, leaving staff scrambling to find replacement services for dozens of clients.

Washington Empowered Against Violence (WEAVE), at 14th and K streets, announced its closure Tuesday and attributed the move to hard economic times. But city officials and one of the agency’s co-founders said WEAVE was closing after losing two major grants because of concerns about possible mismanagement of the funds.

The announcement said the board of the agency, formerly known as Women Empowered Against Violence, is trying to “manage a transition of cases and clients with the help of our funders and community partners” and referred those in need of assistance to a staff attorney and a counselor.

Fernando R. Laguarda, chairman of WEAVE’s board of directors, said the board decided to close because of financial problems he attributed to the economy. He said the 12-member staff has been notifying clients for a week and is working to place clients with other agencies in the area. He said six of the 12 staff members were to be let go this week. He was not sure when the work of moving clients will be completed and the rest of the staff sent home.

Lydia Watts, one of the agency’s co-founders and its former longtime executive director, said WEAVE is being shuttered because concerns have been raised about possible mismanagement of two grants that the agency has lost.

Last year, WEAVE provided legal and counseling services to about 350 people, according to its Web site. Its annual budget is a little more than $1 million, organization records show. According to a financial statement, the agency had about $250,000, about a two-month reserve, in the bank at the close of the fiscal year Sept. 30.

The D.C. Office of Victim Services recently pulled a $100,000 grant and the D.C. Bar Foundation rescinded a $170,000 grant because of concerns that funds were not used for the designated purposes, D.C. officials said.

Melissa Hook, head of the Office of Victim Services, said her office is awaiting documentation from WEAVE about how funds were dispensed.

“There were questions raised about the billing process,” she said. “We are withholding judgment until we see what develops.”

Laguarda would not discuss inquiries into grants or other problems in the agency, but Watts and others said trouble has been brewing for months between staff members and the agency’s most recent executive director, Jeni Gamble, who left last month. Employees unionized last month, Laguarda said. He would not describe the circumstances related to Gamble’s departure. She could not be reached to comment.

Angela Lauria, a client of WEAVE who started receiving services in January 2009, said she learned of the closure Jan. 26 when she went to a group counseling session.

Lauria, a book publisher from Northwest and the mother of a 6-year-old boy, said she learned about WEAVE from a legal clinic. Assuming it was need-based, she called for a referral because she is not indigent.

“They were amazing. They said ‘Come in today to our legal clinic,’ ” she said of WEAVE. She has received counseling and legal assistance and is divorcing her husband.

Lauria said she was unaware that the agency was in serious financial trouble. She said the counselor told her that WEAVE was closing because “our grants have been pulled.”

City officials and others outside city government familiar with the agency’s operations said WEAVE lost the two grants amid questions about the way funds had been administered.

“It’s not that anybody thinks the money was stolen, just that because of inexperience, things were billed that the funds weren’t allocated for,” an official in the D.C. government said.

Watts, one of four American University Washington College of Law students who started the organization to provide legal, counseling and support services to domestic violence victims, said she resigned from the board in November because she disagreed with how the agency was being run.

Staff writer Nikita Stewart contributed to this report.