Charities Deny They Hushed Up for Mather

Members of California’s closely knit community of homeless advocates acknowledged Tuesday that they began to suspect that prominent activist Scott Mather had sold them questionable insurance policies months before his public admission.

But they denied covering up his activities to protect their own programs.

Mather, a Newport Beach insurance broker and a former chairman of the California Homeless Coalition, said last week that he had accepted more than $27,000 worth of premiums from several shelters in Orange and Los Angeles counties but failed to provide insurance coverage, instead using the money himself.

The admission shocked colleagues who knew Mather as a tireless advocate for the poor and homeless. And the revelation has led to an investigation by state insurance authorities.

But those familiar with the events said questions about Mather’s business dealings were first raised as long ago as October. Several associates confronted Mather with questions in early March, but it was several more weeks before alarms were sounded publicly and charities that were potential victims were warned.

Many of Mather’s associates cited the seriousness of the allegations and said they felt precluded from voicing their concerns publicly because they lacked sufficient evidence of wrongdoing. They conceded that they also feared that the news might tarnish the image of their causes, most of which rely heavily on financial contributions from the public.

“It’s not an excuse, but it’s always a concern that charities will be viewed as victims of mismanagement or instability,” said Dolores Barrett, executive director of the Anaheim Interfaith Shelter. “Once things go public, people often don’t read the whole story. . . . There was concern that this should be handled without a lot of publicity.”

Barrett said her group first learned in October that $5,000 paid to Mather for liability insurance had not bought them coverage. She said the group consulted an attorney and set out to obtain authentic policies, as required by law, to protect their clients.

But the Anaheim Interfaith Shelter did not alert authorities or other charities, she said.

Directors of some shelters that were victimized said they were, until recently, unaware of the extent of the allegations.

“I think it would have been real helpful had (those) who had known earlier come forward and notified others of us,” said Linda Schulein, president of the Orange Coast Interfaith Shelter, which paid Mather more than $5,000 for phony insurance policies.

“Part of the problem,” she said, “is that everyone trusted and respected Scott so much that maybe they thought it was isolated and not widespread.”

However, Schulein agreed that fear of wider ramifications may have silenced many who knew: “There was a fear that (Mather’s actions) would reflect back on the homeless community, I’m sure that was a big part of it. Shelters are truly the victims and did not do anything to cause this, but there is a fear of the consequences in the greater community.”

Jean Forbath, executive director of Share Our Selves, which paid Mather $1,350 for what turned out to be phony insurance policies, also cited an abiding respect for his efforts on behalf of the homeless.

“We didn’t want it to be blared out,” she said, “but we were thinking more in terms of Scott and the effect it would have on his family.”

Mather had been chairman of SOS but was asked to resign when allegations about his actions came to light in mid-March, Forbath said.

“We didn’t want to be the ones to blow the whistle. . . . He had done such tremendous things for us,” she said.

Forbath also said some SOS directors may have been reluctant to look a gift horse in the mouth. Mather was one of their own, who offered to buy them insurance for extremely low premiums and no deposits.

“We thought it was wonderful,” she said. “We made no deposit, and we got binders. We kept asking when we were going to have to pay for the rest of it, and he would say don’t push it or it will be canceled. In retrospect . . . it was foolish.”

Directors of five organizations have indicated that they were issued phony insurance policies, among them the Anaheim Interfaith Shelter, the Friendship Shelter in Laguna Beach, SOS, Orange Coast and the Harbor Interfaith Shelter in San Pedro.

Mather has said he is not sure how many organizations may be involved or the exact amount of money he diverted for his personal use, although totals have reached more than $27,000 so far.

He said he first began diverting insurance payments about five years ago to support his struggling independent insurance business and to pay medical bills resulting from a serious illness to one of his children.

He said he has taken out a second mortgage on his Costa Mesa house to repay the shelters and does not regret his public admission of guilt.

“I was advised not to speak out, but I think it is the right thing to do,” he said.

However, many associates who were suspicious said Mather revealed his misdeeds only reluctantly to them, which prevented them from taking action sooner.

Dennis Christiansen, executive director of Harbor Interfaith Shelter in San Pedro, said: “Even after he admitted to some of us there was a problem, it wasn’t a clear statement and sounded like it could be as much mismanagement as intentional.

“He was saying he would get us the documents we needed and that he had a bad secretary. It was a sufficiently gray area. . . . We were in no position to turn around and call the cops.”

Christiansen said both an attorney and an insurance investigator who happen to be on his board of directors were not sure that they had enough information to do anything more than demand that Mather repay them.

But by mid-March, Christiansen and several other members of the California Homeless Coalition--of which Mather had been chairman before resigning--decided that there should be a more widespread alert.

The San Pedro shelter filed a formal complaint with the state insurance commissioner’s office, and the homeless coalition sent an insurance fraud alert over a computerized charity information network. But even then, they decided not to name Mather.

“We went back and forth and finally decided it was risky and potentially dangerous, that the whole thing could be terrible mismanagement,” Christiansen said. “It was very confusing for quite a while. Still, at some point we decided we had to say something.”