A Michigan nonprofit founder stole $1.4 million meant for vulnerable preschool children; the organisation eventually shut down and 35 employees lost their jobs

A Michigan nonprofit organisation that was set up to support vulnerable preschool children shut down after its founder diverted $1.4 million in taxpayer and donor funds for personal use. The fraud affected Early Learning Neighborhood Collaborative (ELNC), which provided essential services to children and families in some of the poorest communities in West Michigan. Its closure in 2023 left 35 employees without jobs and deprived several preschools of financial support. The founder, Nkechy Ezeh, was sentenced to more than 5 years in federal prison in May 2026.Michigan nonprofit founder stole $1.4 million meant for preschool childrenAccording to the US Department of Justice, Ezeh, 61, founded Early Learning Neighborhood Collaborative(ELNC) and served as its chief executive. The organisation received funding from government programmes and private donors to improve early childhood education in underserved communities.Its funding came from the federal Department of Health and Human Services' Early Head Start programme, the US Department of Education and 3 major charitable organisations in Michigan. The money was intended to support children who needed additional assistance during their early years.The nonprofit provided meals, transportation, financial assistance, advocacy and other services to children attending preschools in disadvantaged neighbourhoods. These resources were particularly important for families who could not easily afford additional childcare and educational support.However, prosecutors found that Ezeh had diverted approximately $1.4 million from the organisation for purposes unrelated to its work. The money included taxpayer funding and donations that were supposed to benefit young children and their families. The Department of Justice announced her sentence on May 13, 2026.How was the money allegedly spentThe investigation revealed that the money was used to support Ezeh's personal lifestyle rather than the organisation's educational programmes. According to the US Department of Justice, her spending included luxury holidays, family expenses and payments to relatives who were listed as employees despite doing little or no work.A report by CBS News Detroit detailed how Ezeh used money from the nonprofit to travel to Hawaii, Europe and Africa. She also used some of the funds to pay for a family member's wedding.One of the methods used in the scheme involved what investigators described as a ghost payroll. Ezeh placed family members on ELNC's payroll, allowing them to receive payments even though they performed little or no legitimate work for the organisation.According to prosecutors, these payments amounted to hundreds of thousands of dollars. The arrangement meant that money intended to provide practical support to preschool children was instead being channelled to people connected to the founder.The fraud also involved transfers to Nigeria. Prosecutors said Ezeh used intermediaries, commonly known as money mules, to send hundreds of thousands of dollars in stolen funds to her family members in the country.The impact on children and employeesThe consequences extended well beyond the organisation's finances. ELNC eventually closed its operations in 2023, leaving 35 employees without jobs. According to the Department of Justice, the workers were laid off without notice as the organisation shut down.The closure also affected preschools that had depended on the nonprofit for financial assistance and other resources. Several centres lost funding, while children and families who relied on its services were left without the support they had previously received.The Department of Justice highlighted the circumstances of the children affected by the closure. Most of those served by ELNC were children of colour under the age of 5. Around 72% lived below the federal poverty line, with many coming from some of the poorest neighbourhoods in Kent County, Kalamazoo and Battle Creek.These families were among those who stood to benefit most from the organisation's services. US Attorney Timothy VerHey said the money taken from the organisation could have supported hundreds of children across West Michigan.Ezeh's professional background and the investigationBefore the fraud case, Ezeh had a recognised position in Michigan's education and nonprofit sectors. She received the West Michigan Woman of the Year award in 2018 and was appointed twice to the executive committee of Michigan's Early Childhood Investment Corporation.She was also a tenured professor of education and had established ELNC to improve early childhood support in underserved communities.According to the International Centre for Investigative Reporting(ICIR), Ezeh eventually admitted that she had conspired to steal approximately $1.4 million from ELNC and its donors between 2017 and 2023. She entered a guilty plea to wire fraud and tax evasion charges as part of an agreement with prosecutors.Ezeh's former bookkeeper, Sharon Killebrew, was also prosecuted for her involvement in the scheme. The Department of Justice said Killebrew was sentenced to 54 months in federal prison in November 2025 for her role as a co-conspirator.The court orders prison time and financial repaymentOn May 13, 2026, Chief US District Judge Hala Y. Jarbou sentenced Ezeh to 70 months in federal prison for the fraud scheme. She also received a concurrent 60-month sentence for evading income taxes, meaning the two prison terms will be served at the same time.The court ordered her to pay $1.4 million in restitution to the victims of the fraud, along with an additional $390,174 to the Internal Revenue Service. She was taken into custody immediately to begin serving her sentence.You use AI every day. Now get your AI Quotient. Take the AIQ test.