Federal funding for two South Jersey programs managed by Atlantic Human Resources Inc. were suspended Wednesday after a federal agency alleged the nonprofit was mismanaging funds.

Jeopardized by the funding freeze are Foster Grandparents, which supports 266 local children, and the Retired Senior Volunteer Program, said Erwin Tan, director of Senior Corps. Senior Corps is part of the Corporation for National and Community Service, the federal agency that awarded the grants to Atlantic Human Resources to fund the programs.

“It is beyond disappointing that, as a result of Atlantic Human Resources’ failure to manage its federal funds appropriately, Foster Grandparents and the children they serve could see an interruption in their service,” Tan said. “At this time, we are working to find a way to allow the Foster Grandparents volunteers to keep serving their community.”

Tan visited the area Tuesday and met with more than half of the 150 volunteers in the programs, said Samantha Jo Warfield, spokeswoman for the Corporation for National and Community Service in New York.

Atlantic Human Resources is a local nonprofit that oversees several federally, state and locally funded educational, housing assistance, senior assistance and financial assistance programs. The head office is on New York Avenue in Atlantic City, but it has more than 20 locations, including day care centers, in Atlantic and Cape May counties.

Atlantic Human Resources was forced to give up control earlier this month of the 20 Head Start programs it oversaw in South Jersey amid an investigation that found the preschools did not meet federal standards. The agency has also had several of its bank accounts frozen as a result of a civil lawsuit alleging it hasn’t paid some of its bills.

The 150 Foster Grandparents volunteers support 266 children in Cape May, Cumberland, Gloucester and Salem counties.

Atlantic Human Resources was awarded a three-year, $1.5 million grant to recruit and place volunteers ages 55 and older in schools and Head Start centers to act as mentors and tutors to children with special needs as part of its RSVP program.

The grant expires in September.

After a March 2012 visit, the Corporation for National and Community Service audited the Foster Grandparents and the RSVP programs and discovered “programmatic and fiscal concerns,” Warfield said.

“We alerted the CNCS Office of the Inspector General about our concerns of financial mismanagement … and requested an audit of both grants,” Warfield said, including the Foster Grandparents grant.

Atlantic Human Resources is under investigation for allegedly failing to reimburse volunteers, Warfield said. The “suspension is necessary,” but the nonprofit is allowed to appeal the decision, she said.

For now, CNCS said it is going to ensure the volunteers receive their stipends and are searching for a new grantee.

Multiple calls to Atlantic Human Resources Executive Director Joseph Gaynor and board members were not returned. Several phone numbers listed on the Atlantic Human Resources website are disconnected.

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