In July 1986, Marianna Ramsay and seven other Rainbow Retreat associates were indicted in connection with alleged embezzlement from a bingo operation run by the shelter's executive director, Joanne Rhoads. (Laswell-Daniels was not indicted.)
Brighter Tomorrows had already changed its name to The Open Door Shelter after it was discovered that Rhoads was starting a shelter in New York by the same name.
And the same month of the indictments, Ramsay resigned from The Open Door Shelter's board of directors. She later pleaded guilty to a single count of filing false documents and served nine months' probation.
Laswell-Daniels began fund raising in 1986, although The Open Door didn't actually open its doors until October 1987, in a fourplex near 16th Street and Brill.
From the beginning, the money flowed into The Open Door. Laswell-Daniels was an expert at telemarketing. In 1987, the shelter raised $327,000, according to IRS documents; in 1988, the figure climbed to $403,000.
And all along, the shelter never accommodated more than six women and 12 children.
Laswell-Daniels soon decided to expand and chose San Diego as another location. But the San Diego directors tried to take over the shelter, then skipped town when Laswell-Daniels sued. She says she lost $30,000 in legal fees and startup costs.
Even though the shelter's cash flow appears to have been enough to accommodate such expenses, Laswell-Daniels says she paid the San Diego debts with her personal credit card, then reimbursed herself from Open Door funds over the years.
None of this was documented, she admits. And when Evelyn Henke joined the shelter staff as a bookkeeper in 1991, Laswell-Daniels failed to mention that the shelter owed her money.
"[Evelyn] knew money was being paid back for credit cards. She didn't know what it was for," Laswell-Daniels says. She says she also used her credit card to make payroll for six to eight weeks at one point; this was never documented, either.
Laswell-Daniels recalls, "I would go to the bank, get money on my credit card, put money in The Open Door Shelter['s] checking account, and that's how I would make payroll."
The concept of generally accepted accounting procedures was not familiar to shelter administration.
Henke admits that if the shelter's finances "ever came under an auditor or an IRS check, then we'd have a lot of explaining to do. . . . I can see where [the shelter] got into deep doo-doo just by not documenting."
Laswell-Daniels says she lent the shelter $15,000 in 1986. She has a signed note. But when she decided to repay herself $10,000 last year from the shelter's savings account, she didn't bother to tell anyone on the board or her bookkeeper, Henke, who discovered it when the books didn't balance.
Laswell-Daniels says she's owed an additional $5,000. So she's keeping the shelter's 1988 Chevrolet truck--which was purchased in her name and paid for with shelter funds--as collateral. She already has a 1988 Chevrolet Beretta which was partly paid for by the shelter. The title is in her name.
She says, "The Beretta is in my possession. I have always used it. . . . I do not feel that I owe the shelter that car."
She says she purchased the vehicles in her name because the shelter couldn't get credit. "The credit and everything with the shelter was yucky-poo," she says.
Laswell-Daniels was accused last year of taking a donation check for $40,000. She took the check, she admits, but only for safekeeping. She returned it after she was confronted by board members.
She says, "I never wanted to take that money. Jesus Christ, I have to look at me every morning."
In 1994, Laswell-Daniels wrote about $8,500 in Open Door checks to various credit-card companies. She and Henke admit that there is no record of what was purchased; the checks were simply recorded as "services." All of the checks were signed by Laswell-Daniels herself.
Last December, Henke and Laswell-Daniels wrote bonus checks to staff members--including $2,000 each to Laswell-Daniels and her husband (he worked in the thrift store) and $1,000 to Henke. The bonuses were logged as "educational" expenses.
Laswell-Daniels says the board of directors didn't have to approve such expenses. Apparently, it didn't approve much of anything.
Stevie King, who served on the board from about 1990 to 1995, admits she was not very active. Until last year, the board only met once a year. She doesn't recall seeing any financial information, or asking for it. She says, "If there were financial statements, I didn't look at them real closely. As long as we were not in the [red], I was happy."