The District of Columbia has filed a lawsuit against Kenneth Brewer Sr., the former executive director of the H Street Community Development Corporation (HSCDC), alleging he misappropriated more than $1.25 million in nonprofit funds through unauthorized bonus payments and self-dealing.
The complaint, filed in the Superior Court of the District of Columbia, outlines a years-long scheme in which Brewer, who led the nonprofit and its for-profit subsidiary, H Street Investment Corporation (HSIC), allegedly bypassed board oversight and diverted money meant to support affordable housing and economic development in the H Street Corridor.
According to the complaint, HSCDC is a 501(c)(3) nonprofit created to revitalize the H Street neighborhood through housing, advocacy, and investments. Brewer was hired in 2010 as executive director of HSCDC and HSIC, a wholly owned for-profit subsidiary.
The nonprofit’s bylaws and Brewer’s contract required that his compensation, including bonuses, be approved by the HSCDC board following a review process conducted by an outside law firm.
While Brewer followed this process from 2011 to 2016, the District alleges that he abandoned these protocols beginning in 2017. Instead, he sought approval only from HSIC’s board — bypassing HSCDC’s required oversight — and awarded himself bonuses far exceeding previous years. Between 2017 and 2022, Brewer received a total of $1,255,000 in bonuses from HSIC funds, the lawsuit claims.
To fund these bonuses, the complaint asserts that Brewer directed the sale of HSCDC-owned properties and transferred the proceeds to HSIC, then to his personal accounts—without notifying the HSCDC board or obtaining court approval, as required under D.C. law for charitable asset transfers.
Among the alleged transactions, Brewer authorized $200,000 of a $250,000 bonus in 2019 to be paid using funds from the sale of 721 H Street NW, and in 2018, he instructed staff to transfer bonus funds following the sale of properties at 808–812 13th Street NE. Email evidence included in the complaint shows Brewer directly instructing HSCDC’s comptroller to move the money.
In April 2023, HSCDC’s board learned of a $350,000 bonus authorized by HSIC in October 2022 and voted the following month to rescind it. Brewer retired from HSCDC and HSIC on June 30, 2023, but has not returned the unauthorized compensation.
The District argues Brewer violated several provisions of the Nonprofit Corporation Act, including fiduciary duties, restrictions on diverting charitable assets, and the common law principles of unjust enrichment and breach of fiduciary duty.
“As a direct and proximate cause of Brewer’s misappropriation of HSCDC’s nonprofit funds… HSCDC has suffered damages of at least $1,255,000,” the complaint states.
The Office of the Attorney General, led by Brian L. Schwalb, said it is seeking a court-ordered accounting of HSCDC’s finances, the imposition of a constructive trust over the diverted funds, and other equitable relief.
Attorneys Martine C. Wilson and Cara J. Spencer represent the District in the case.
Schwalb’s office said the lawsuit is part of ongoing efforts to ensure nonprofit leaders use charitable assets for their intended public purposes.
“It would be unjust for Brewer to retain” these funds, the complaint concludes.
