Pair behind Times Square organization for the homeless linked to shut-down charity scam

NEW YORK (WABC) -- Mixed in with the aggressive cartoon characters, peddlers and street performers, there's another Times Square group trying to make a buck off tourists.

They say they're homeless men and women working as Visitor Information Specialists for the Times Square News, but when the Eyewitness News Investigators went undercover, we found a lot of misinformation from an operation linked to a charity scam that was shut down years ago.

For years, men with plastic jugs dotted the city, raising funds for the United Homeless Organization. But four years ago, then New York Attorney General Andrew Cuomo shut down the operation, calling it a fraudulent scheme.

The organization's founders, Stephen Riley and Myra Walker, were sued for obtaining money by false pretenses and banned from ever running a non-profit again after it was alleged that they used to collected change for personal use.

But we found them back in business, looking and sounding a lot like a charity for the homeless.

Our undercover producer asked where her money was going.

"For the homeless," she was told. "To buy soup sandwiches, hot coffee, toothpaste, deodorant, paper towels, a way of getting us on our feet."

The water jugs from the past are now replaced with crude information booths run by the Times Square News, which publishes a monthly newsletter.

"It's an information newsletter, and the money raised goes to help to feed the homeless," a worker said. "Times Square News is run by a young man named Stephan Riley. He's actually our editor."

Tourists are asked to give a tip in exchange for help from what the Times Square News calls their "information specialists."

And when we went undercover as tourists, we found found a lot of solicitation, but little advice. Also, the advice that was given was often inaccurate, including sending tourists to places like Pier 17 at the South Street Seaport, which now exists only as a pile of rubble. We were also incorrectly directed to the MOMO museum, instead of the MOMA (Museum of Modern Art).

"This is an example of the product which they're distributing which is virtually nothing," State Senator Brad Hoylman said.

Hoylman, who represents the Times Square District, says it's clear to him that the banned United Homeless Organization is back, this time panhandling under the guise of a legit business.

"Run by Mr. Riley, who's been busted once by the attorney general, and has cropped up again to defraud tourists and other visitors to Times Square," he said.

We tried to speak to Riley and Times Square News publisher Myra Walker, to ask them what they're doing with all the money given by tourists. A worker at their offices assured us that the money goes specifically to the homeless.

State Senator Hoylman is calling on the attorney general to investigate the operation. He says the AG needs to rid Times Square of vendors shaking down unsuspecting New Yorkers and tourists.