Action News Jax Investigates: New inspector general report reveals sex scandal, alleged mismanagement and lack of oversight at Kids Hope Alliance

JACKSONVILLE, Fla. — Action News Jax has found explosive details in a new office of inspector general report about a former leader of a Jacksonville city organization.

The report says former Kids Hope Alliance CEO Joe Peppers had an affair with a woman, who eventually claimed sexual harassment.

Peppers was allowed to remain her supervisor and according to the inspector general report the city did little about it.

The investigation started after the city received an anonymous letter detailing issues at the agency in Aug. 2019.

It concludes Peppers “engaged in a consensual sexual relationship with a senior leadership team member, who directly reported to him” from Aug. 2018 through Feb. 2019.

However, on April 15, 2019, when the relationship was deteriorating Peppers sent a text message to his now-former mistress:

“You’re only loyal when your life or well-being are threatened' and “this is who I see now” referring to six different interracial pornography images sent as part of the text message. Additionally, Peppers alluded that he would disclose personal information to her child.”

The report says that same month Mayor Lenny Curry was made aware of the Peppers affair by his top two officials Brian Hughes and Sam Mousa after they were informed by KHA Chairman Kevin Gay but it’s unclear if it was before or after the text message.

Gay is quoted by KHA’s Chief Operating Officer as saying Peppers was “going through a lot … everyone deserves a second chance”

Soon after, Peppers went out on FMLA and the woman complained to Gay about how she was being treated by the agency saying “there was a complete lack of recognition of the traumatic experience I had just been through,” She would go on to ask not to report to Peppers, but when he returned in June 2019 he continued direct supervision over his former mistress.

The report says Mousa explained that he, Chief of Staff Hughes, and Mayor Curry protected both Peppers and the woman “by not spreading rumors or gossip” about the affair.

Mayor Curry’s testimony stated he expected Gay to be “in charge” saying “that’s an independent board with a board chair and, you know if Kevin thought it was the right thing to do, I was going to be hands-off and supportive”

Action News Jax first told you in 2019 Peppers wrote an email in September 2018 about a meeting in August 2018 with Hughes - then Chief of Staff and now Chief Administrative Officer - and former Chief Administrative Officer Sam Mousa saying “I am also going on record as stating that I believe that I’m under undue influence from the Mayor’s office.” It was in regards to $350,000 in grants that he felt pressured to give to certain groups. He went on to say “Brian and Sam stated that there would be designated applicants that would get preferential treatment during the application process.”

The inspector general concluded that the allegation was “unfounded”

It did conclude Peppers misused his position by recommending two organizations for grant funding “in the amount of $100,000 each” from a non-profit run by people he knew.

However, there are no city polices regarding consensual sexual relationships between supervisors and subordinates or disclosure of potential conflicts in a special hiring process.

The city says it is addressing those issues. The report was forwarded to the State Attorney’s Office who declined to pursue any of the findings.

Peppers sent this statement to Action News Jax:

“I’m not surprised by anything the COJ administration does anymore. I’ve served my country proudly three times in Iraq, and to be made out to be a shady grifter by function of a porous IG investigation, is par for the course for the COJ. The people in the room that day in August 2018 know exactly what was said and implied for the micro-grants. That’s why they are telling the story of why I went to rehab without telling the public I went to rehab for PTSD. To them, I’m just another crazy black veteran. They know what they did was wrong, and they know that exposing my faults robs me of credibility. They have a saying in the Middle East. Some government officials only like to be in government because they like the chair of power. That’s never been more true in Jacksonville than the last five years. I made mistakes in terms of my personal and private relationships, but the reporting that indicates that I tried to hook up my friends is so far from reality and so misleading to the public that it doesn’t deserve any more of my time. Most of this happened almost two years ago. I’ve moved on. I wish Jacksonville nothing but the best!”

Peppers sent a second statement through his attorney:

“I want to add my comments explaining the reasons for the extended period of leave that I took, and express my appreciation for the role played by the Board of the Kids' Hope Alliance. I am a disabled veteran, with three tours of duty in Iraq, and I have battled against the effects of PTSD from my military experiences for many years. It became apparent in the late spring of 2019 that I needed intensive treatment and therapy for my condition, and I communicated my needs to the Board Chair, Kevin Gay. Mr. Gay was understanding and supportive, and he permitted me to take the leave necessary for needed treatment. I have made mistakes and apologize to my friends and family for putting them through some very difficult times. I was in a very dark place and made some poor decisions. Together we felt that we could move forward with the leadership of the organization after my return, in light of the treatment I received and the fact that the employee at issue was scheduled to leave based of her own accord. I am truly remorseful for the effect any of this had at Kids Hope Alliance. I’m incredibly grateful to Mr. Gay and the Board for affording me grace and understanding as well as allowing me to work through my trauma and continue on as CEO following the treatment I received for PTSD.”

The City sent the following statement:

“The Administration is grateful for the Inspector General’s work outlined in today’s reports. We are disturbed by the findings regarding previous leadership at KHA and will continue the work that has already begun to restore the trust the departed CEO violated. As to claims he made against Mayor’s Office staff, we are grateful for the Inspector General’s very thorough review that deemed those accusations baseless and unfounded. KHA continues to be an important organization in the fight to protect every Jacksonville child’s access to hope and opportunity. Mayor Curry, his team, and the new leadership at KHA will continue to work towards that important mission.” Nikki Kimbleton, Director of Public Affairs/ City Spokeswoman