GAMALIEL, Ark. — For John Flatley, 2012 was a very good year.
As president of the board of Dismas House of St. Louis — the oldest halfway house for federal prisoners in the country — he also paid himself a hefty salary as executive director of the facility in north St. Louis.
Flatley made $645,450 that year.
It wasn’t enough. A guy making that kind of cash needs a lake house.
So in 2013, Flatley bought one, but not with his money. Instead he used money from a federal contract intended to help federal inmates transition back to society. The lake house — worth more than $300,000 six years ago when Dismas House bought it — sits on the shores of Norfork Lake in northern Arkansas, just 10 minutes south of the Missouri border.
A few years ago, the home was a well-worn 1970s vintage ranch-style house, like so many of the ones surrounding it on Baxter County Road 806. Just south is the Three Oaks Resort, one of those places with separate cabins that time seems to have forgotten, where a character in an Ozarks-based HBO drama might hole up after a bender. There are RV parks and mobile homes that have seen better days.
But the Dismas House lake house now is first class, remodeled with log-cabin siding, a top-notch galvanized aluminum roof, a new detached garage that matches the house’s exterior, and a 2,500-square-foot driveway with plenty of room to turn around Flatley’s 28-foot cruiser boat.
The lake house is just the latest evidence that Flatley and his family have turned the Dismas House nonprofit into their personal piggy bank. The board, according to Missouri Secretary of State records, consists of Flatley, Vivienne Bess, Gary Bess and Kathleen Sullivan. Vivienne Bess is Flatley’s sister. Gary Bess is Vivienne’s husband. He was a longtime parks director in the city, and until shortly after former St. Louis County Executive Steve Stenger pleaded guilty to a federal indictment on bribery and fraud charges, Bess was his director of county parks. Sullivan is Bess’s longtime aide.
In late May, I reported that between 2011 and 2016, Flatley and Vivienne Bess were paid more than $4.9 million in salary from the nonprofit, whose only source of income is a federal contract to house inmates from the Bureau of Prisons. The current version of that contract is worth $43 million over five years.
Nine days after that column was published, the lake house changed hands.
On May 29, Flatley sold the house to another nonprofit run by his family, called Forward Assist Inc. That’s the nonprofit run by Flatley’s son, Patrick, that was formed in 2011 to spin off Dismas House assets. The nonprofit also owns a for-profit real estate development company called Forward Invest.
Why did he sell the Dismas House asset?
“Because they asked me to,” Flatley told me.
“They” is the board of Dismas House, which Flatley runs. He referred any questions about the lake house to Randy Howard, the current executive director of Dismas House, and a board member of Forward Assist. Howard says Forward Assist might start operating the lake house as an Airbnb rental, or the board might just sell the property.
“It didn’t work out for us,” Howard said when I asked him about the property.
The lake house, Howard said, was bought as a retreat, not for inmates, mind you, but for “management and the board.” In other words, it’s a Flatley family vacation house.
Howard said he’s been there a couple of times.
“It’s OK,” he said. “It was nice.”
On the recent Fourth of July weekend, Flatley’s Jaguar XJ8 was parked in the driveway.
“I think that’s where he keeps it,” Howard told me.
Howard claims the board voted to “sell” the lake house two years ago, but never got around to it. He says the Secretary of State records are wrong, that there are lots of people on the Dismas House board that have no connection to the Flatleys.
But he won’t name them.
The true tale is in the public records.
John Flatley’s signature as the executive director of Dismas House is on the warranty deed that less than two months ago transferred the Arkansas lake house from the nonprofit he runs to the one headed by his son.
The sale price on a home that six years ago sold for more than $300,000?