Former employees of Rainbow Health are demanding answers from the Minneapolis nonprofit that shut down abruptly last month.

The nonprofit closed on July 18, giving staff only a few hours’ notice.

“All along, they have refused to examine how we got here,” said Ash Tifa, a former employee.

Tifa was joined by about a dozen other Rainbow Health workers at a news conference Thursday.

“We need to let the board know their continuous actions, their inability to answer our questions, apologize and explain how this traumatic event happened are unacceptable,” said another former employee, Lee Start.

The nonprofit generated $14 million in yearly revenue, according to available tax records, and provided an array of services for the LGBTQ community and those living with HIV.

Employees said the closure came as a shock to the nonprofit’s 80 workers and thousands of clients.

“We were told that there was no more money, see ya later,” said former employee Rik Kutcher.

Rainbow Health shared a new statement Thursday:

“The Rainbow Health Board of Directors is currently undertaking the dissolution process of our organization. As a part of this process, we are required to submit a Notice of Intent to Dissolve to the Attorney General’s Office that provides details on our assets, liabilities, and costs of dissolution. We hope to file that as soon as possible, with a goal of getting it in by Friday, August 16, 2024. Our priority is to meet all legal obligations and ensure assets are distributed in accordance with the law. Our former employees and former clients remain top of mind during this transition. We have had several meetings with the SEIU and our legal counsel met with them again today.

In partnership with DHS (Minnesota Department of Human Services) and the Aliveness Project, we have transferred former HIV care responsibilities to The Aliveness Project. We continue working with local organizations to transfer LGBTQ+ services to appropriate groups.

We understand the significant impact of Rainbow Health’s sudden closure on our community, clients, and employees. We had to make the unfortunate decision to close abruptly to ensure we could pay employees for the time they had already worked (this included their wages, health insurance, and retirement contributions). We are doing our best to wind down with limited resources in order to maximize payment on our outstanding debts and other obligations. We ask for your patience as we move through this process and will share more information as we can.

We are deeply grateful for the dedication and support of everyone involved during this challenging time.”

5 EYEWITNESS NEWS is getting new insight into the financial problems the organization was facing.

Their most recent state-mandated financial audit, completed in October 2023, found ‘deficiencies in internal control,’ including a lack of checks and balances for transaction entries, missed deadlines and inability to accurately identify total federal expenditures.

The audit also noted there was ‘limited staff in the finance department and limited oversight over finance department activities.’

5 EYEWITNESS NEWS also spoke with a former Rainbow Health board member, who asked to remain anonymous, about what was happening at the organization behind closed doors.

That person stated: “I’ve been on several boards of this caliber and have never seen one managed this way.”

The former board member, who resigned this year, told us Rainbow Health missed major deadlines for grants, mismanaged multiple funding sources and never held staff accountable for budgets.

They also said, during board meetings, “big financial issues would get dismissed, with a sunny demeanor on it” and that the organization’s failure was “so sad and so avoidable.”

Former employees are now asking the state attorney general to step in and investigate.

“For the future of other organizations, things should be done to stop this mess,” said Uzoamaka McLaughlin.

A spokesperson for the attorney general’s office told 5 EYEWITNESS NEWS:

“The Minnesota Attorney General’s Office cannot confirm or deny the existence of an investigation. We take concerns regarding nonprofits and charities seriously, and we encourage anyone with complaints about Minnesota nonprofits to share those with the Attorney General Ellison’s Office using the form available at this link.”