Grand jury indicts Queer Works CEO on multiple fraud charges
In an announcement made Wednesday, Queer Works founder Jacob Rostovsky is accused of misusing over $840,000 in public funds intended for housing assistance and basic income payments.
Jacob Rostovsky, CEO of Palm Springs-based nonprofit Queer Works, faces a 53-count indictment on charges including fraudulent claims, grand theft, and money laundering, it was announced on Wednesday.
In a statement released to the media, Riverside County District Attorney Mike Hestrin revealed allegations of misuse of over $840,000 in public funds intended for housing assistance and basic income payments in the city of Palm Springs and Riverside County.
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The 33-year-old Rostovsky surrendered at the DA’s Office on Oct. 17 and posted bail of $944,000. He was arraigned at the Hall of Justice in Riverside when the grand jury indictment was unsealed.
Queer Works, founded by Rostovsky, purportedly aimed to provide mental health services to the transgender and nonbinary community. The organization received grant funding from Riverside County in July 2021 for programs assisting homeless individuals and victims of domestic violence.
In March 2022, the City of Palm Springs agreed to provide Queer Works with $200,000 to develop a universal basic income pilot program. The Palm Springs City Council later approved an additional $500,000 in matching funds for a universal basic income grant in July 2022.
“I am calling on the Riverside County Civil Grand Jury to investigate any potential government malfeasance or misconduct that may have occurred in the administration of these contracts,” said DA Hestrin. “It is simply unacceptable that public funds are handed out with the lack of due diligence or oversight that is alleged in this case.”
In a statement released Wednesday afternoon, the city expressed full support of the investigation into Rostovsky and defended its actions.
“The city is committed to ensuring full accountability for public funds and has already taken significant steps to prevent such incidents from occurring in the future,” the statement read in part. “In light of the allegations, the city has implemented a number of stringent protocols to enhance oversight and accountability for the management of public funds.”
Among the preventive measures proposed in September were the elimination lump-sum payments, mandating regular reporting and audits, tightening vetting processes, and providing staff with enhanced financial oversight training.
The DA’s Office investigation revealed 89 separate instances of Rostovsky allegedly making false statements and submitting forged documents to obtain funds from Riverside County and Palm Springs. The Post first reported the irregularities in July.
Financial reviews by Riverside County Housing & Workforce Solutions uncovered discrepancies in expenses reported by Queer Works and showed Rostovsky altered financial documents submitted to the county. Checks issued by the Riverside County Treasury were reportedly deposited into Rostovsky’s personal checking account.
Prosecutors allege Rostovsky used a portion of these funds, intended for individuals in need of assistance, on personal expenses. These included purchases at Disney, Burberry, and the Beverly Garland Hotel.
The indictment also accuses Rostovsky of impersonating a Queer Works client to file a fraudulent $90,000 insurance claim against the organization. He allegedly negotiated a settlement with Queer Work’s insurance carrier, Philadelphia Insurance, directing the proceeds to himself.
Multiple acts of money laundering related to the allegedly ill-gotten funds are also included in the charges against Rostovsky.
The case includes an aggravated white collar crime enhancement due to the significant economic loss involved in the scheme.
“The people of Riverside County deserve better from their public officials who have a duty to act as responsible stewards of taxpayer dollars,” Hestrin added.
The universal basic income program proposed by Queer Works was intended to provide 180 participants with monthly stipends of $800. It is currently being administered by DAP Health.
Deputy District Attorney Natasha Sorace of the District Attorney’s Public Integrity Unit is prosecuting the case, filed under case number RIF2446500.
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