A Long Island security firm routinely billed taxpayers for full eight-hour shifts at one of the city’s biggest migrant shelters, even as daily time logs kept by staff show hundreds of entries in which guards recorded arrival times later than the shifts started or departure times before they ended, a review by THE CITY has found.
Under a $140 million contract with the city Health & Hospitals Corp. (HHC), Arrow Security last year began providing round-the-clock security at a dozen Humanitarian Emergency Response and Relief Centers (HERRCs), including the Candler Building shelter for men in Midtown.
Arrow submitted monthly invoices to HHC that it certified detailed the hours that each guard was on duty during each shift on each day. The company asserts these invoices are based on electronic data generated by an app called eHub that staff use to check in and out via their cell phones.
But daily paper sign-in/sign-out logs kept at the Candler Building, which houses hundreds of migrants, often contradicted those invoices, an examination by THE CITY revealed.
The invoices show Arrow consistently billing the city hospital system for full eight-hour shifts — with legions of guards all signing in and signing out at exactly the same minute, according to the electronic records.
In contrast, the paper logs record hundreds of entries in which guards recorded showing up late or leaving early. In dozens of cases, the “time out” field was left blank. And though guards were supposed to initial the logs attesting to the accuracy of the recorded “time in” and “time out,” in dozens of cases THE CITY found no signature.
The invoices and logs were obtained by the City Council’s Committee on Oversight and Investigations and reviewed by THE CITY. Councilmember Gale Brewer (D-Manhattan), chair of the committee, worries that the contradictory records at Candler raise questions about the integrity of Arrow’s work at all 12 migrant shelters where it has been providing security since early last year.
Council staff examined records from three shifts on randomly selected dates in June, September and October to compare each staff member’s sign-in and sign-out times on the logs against the invoices. They found a range of 3.5 to 12.5 hours billed above the actual hours worked. That came to between $120 and $425 per shift. With three shifts per day, the staff concluded “the total costs of these extra hours may be significant.”
“The City of New York, since they’re using city money, they should be looking at the same information that you looked at and what we looked at,” Brewer said, adding that the logs that include late arrivals and early departures are “the one they should be paying for. And if it’s not consistent, they should take action.”
“Basically it does sound like two sets of books. Those are two huge red flags,” Brewer said.
The committee obtained the records as part of its overall examination of the Adams administration’s migrant-related contracting, focusing in particular on HHC vendors. Unlike most businesses that are paid by the city government, those vendors are not subject to oversight by the city comptroller.
In May, Council staff asked Arrow to turn over all invoices to HHC at Candler for April through December 2023 and all “staffing logs” documenting the “verification of Arrow personnel present during each shift.” They specifically sought “all sign-in/sign-out records for the Candler Building for the specified time period, including the dates, times, and signatures.”
In response, Arrow turned over the daily logs.
Anthony Manetta, a spokesperson for Arrow, pushed back on the City Council’s conclusions.
“We emphatically state that there is no overbilling,” he said. “The assertion that a paper log is more accurate than our advanced digital time keeping system is baseless and is creating a false narrative. Our shifts, time keeping and invoices have been reviewed and audited and closely scrutinized.”
Like Clockwork
THE CITY reviewed all of the monthly invoices Arrow submitted to the Health & Hospitals Corp. from June through September 2023 and compared those to Arrow’s daily logs during that time period.
In the invoice Arrow submitted to HHC for July 2023, for instance, 99.2% of 5,150 entries for security guards sought payment for full eight-hour shifts, with only 41 requested payments for shifts less than 8 hours. The invoices show all guards on all shifts almost always signing in and out at the exact scheduled start and end of their shifts every day — for instance, signing in at precisely 7 a.m. and signing out at precisely 3 p.m. for the 3-to-7 shift.
But THE CITY found hundreds of entries on daily logs in the first two weeks of July 2023 recording instances of guards reporting shorter shifts, including 222 arriving late and 51 leaving early. In 196 cases there was no time out indicated at all, and in 17 cases there was no time in.
Meanwhile, a review of logs for the 7 a.m. to 3 p.m. shift on 11 randomly selected dates in June, July, August and September 2023 show that in 161 of 420 entries, guards signed in as late as 8 a.m., 9 a.m. and even 10 a.m. — or left as early as 8 a.m. Arrow billed for a full shift for all of those guards.
The logs’ “time out” field was left blank 64 times, while the “time in” field was left blank on a handful of occasions. On June 19, 2023, for example, two guards didn’t sign in, and four guards didn’t sign out. Arrow billed for a full shift for each of these guards.
In response to THE CITY’s questions, city hospital officials confirmed that the staff who have been reviewing Arrow’s invoices never looked at the handwritten sign-in/sign-out logs because they rely instead on data generated by an app that allows staff at the shelters to sign in and out via their cellphones.
In an emailed response to THE CITY, HHC spokesperson Adam Shrier said labeling the daily time-sheets “logs” is “factually inaccurate,” stating that Arrow used the documents “for organizing its internal operations, such as floor assignments, and these documents have never been used as back up documentation for invoices.”
Arrow executives, on the other hand, said the logs “that are kept on site are for backup purposes and are not used in any invoice calculations,” in their emailed response to THE CITY. “The onsite personnel may keep records for their own backup when things get busy or to double check the schedules.”
The contract Arrow signed with HHC requires the firm to operate a “commercial software system for timekeeping utilized by all staff” but to also “maintain contemporaneous records to support all invoiced amounts to be compliant with good audit practices.”
Anthony Manetta, a spokesperson for Arrow, provided a statement from the company describing the cell-phone app system the company uses to tabulate security guard hours as “advanced biometric employee time tracking with geofencing technology.”
HHC spokesperson Shrier said Arrow employees “sign in through their cell phone once on site — employees cannot sign in from another location.”
Arrow said this system “integrates directly” with the company’s invoicing system and that the invoices “are intricately scrutinized by NYC Health & Hospitals and must be certified on a weekly basis since we [are] under prevailing wage requirements.”
The company stated “The paper logs are not the source of how employees time is tracked,” adding that “onsite personnel may keep records for their own backup when things get busy or to double check the schedules.”
Shrier said HHC could not comment on how Arrow uses the paper records but said the agency has approved every invoice Arrow has submitted to date because “all electronic backup records Arrow submitted — which is the only form of backup documentation accepted by the HERRC finance team — match invoices reviewed by our invoice managers.”
Asked last week how much HHC has paid Arrow to date, Shrier would only provide information dating back a year, stating that Arrow had been paid $28 million as of August 2023.
No Comptroller Oversight
One consequence of Arrow guards failing to sign the logs emerged in a September 2023 internal incident report on vendor misconduct filed by a city Office of Emergency Management employee regarding an Arrow employee at another migrant shelter.
The staffer noted that an Arrow site leader scheduled to start at 11 p.m. arrived at the McCarren Park shelter in Brooklyn around midnight but did not enter the facility. The shift was to end at 7 a.m., but the Arrow site leader still wasn’t in the facility by 6:30 a.m., the report states.
The city worker noted that during building inspections they conducted during that shift, they discovered three of four Arrow guards on duty apparently all went on break at the same time. The fourth was found sleeping in a storage room. The staffer tried to learn the identities of the three guards missing in action but came up short “since they failed to sign in at the start of their shift.”
In May, Council staff also questioned the number of security guards Arrow was placing at Candler, noting that from April 2023 through December 2023 Arrow sought payment for more than the 30 guards per shift that were authorized under their original agreement with Health & Hospitals. (By June 2023 the average shift included 42 guards). They also noted a similar pattern at four other shelters where Arrow was providing security.
In response, Dr. Ted Long, senior vice president at HHC, explained that HHC had to dramatically increase security at Candler as the number of migrants flowed into the city throughout 2023. When the Candler opened in March 2023, 11 floors accommodated 687 “guests.” By May of this year 23 floors housed 1,200 people.
Dr. Long emphasized that HHC increased security and fire guard staff at the Candler in consultation with the NYPD and FDNY, stating, “When the Candler ore than doubled in floors and nearly doubled in max occupancy, our security and fire guard staffing had to be right-sized for this expansion as well to ensure the safety of asylum seekers and staff.”
Detecting these types of discrepancies is made more difficult because while city Comptroller Brad Lander has oversight over all city agencies, Health & Hospitals — a quasi-city agency — is not under his jurisdiction. As of July 31, HHC was handling more than $2.1 billion in migrant contracts, more than any other agency.
The integrity of these contracts is essentially a matter of HHC policing itself. Questions about Arrow’s contract emerged last year when THE CITY noted that HHC had awarded the security contract to Arrow despite the fact that the security firm was being sued by another city agency that alleged the firm had failed to keep a Brooklyn homeless shelter safe. In court papers, Arrow has denied the allegation that it failed to keep the shelter safe.
In response to THE CITY’s report, Lander criticized this loophole and pressed for City Hall to provide his auditors with all HHC contracts related to migrant shelters.
Two weeks ago, Lander, who has announced he’s running for mayor, released an audit criticizing another migrant shelter contract overseen by an agency that is under his charge, the city Department of Housing Preservation and Development (HPD).
Lander’s auditors alleged that DocGo, doing business as Rapid Reliable Testing NY LLC, made more than $2 million in unauthorized payments to firms they’d hired to do security at the shelters they were operating in hotels. (Arrow was not one of them.) They found DocGo billing the city for hourly rates of $50, above the average hourly rate of $35 to $36. A spokesperson for DocGo said in response the company was “proud to have helped the city navigate this emergency” and that it had been assured it would be paid for all its work.
Brewer said the contradictions between Arrow’s logs and the invoices would normally trigger a comptroller audit, but because HHC is outside Lander’s jurisdiction that didn’t happen. (A spokesperson for Lander said last week they are now getting migrant-related contracts from HHC although they do not have jurisdiction over them.)
This is an example of why (HHC) should because the comptroller would have caught this,” Brewer said. “It’s like audit heaven.”
Additional reporting by Gwynne Hogan.
