An Oklahoma woman who defrauded more than eight million dollars from a hospital pleaded guilty in federal court on September 26, 2023, US Attorney Clint Johnson announced.
The defendant admitted that, while employed as a telecommunications specialist at the hospital, she devised and executed a scheme to defraud her employer. Specifically, she arranged for the hospital to purchase electronic devices, including laptops, phones, and tablets from a company that provided telecommunications support services to the hospital.
The defendant further admitted that she arranged for the devices to be purchased so that she could fraudulently abscond with the devices and sell them for a profit. To accomplish this objective, she caused the company to email her invoices for the devices, which she falsely represented as being acquired for the hospital’s business operations. She then falsified the invoices by, among other things, forging the signature of her direct supervisor at the hospital. As a result, the defendant caused the hospital to pay for the devices without the knowledge or permission of her supervisors. Once the devices were acquired, she stole and then sold them to acquaintances and other individuals for a personal profit. In total, her scheme resulted in a loss to the hospital of approximately $8,293,611.00.
“The defendant exploited a healthcare system funded by taxpayer dollars in order to line her own pockets,” said FBI Oklahoma City Special Agent in Charge Edward J. Gray. “The FBI and our law enforcement partners will continue to aggressively pursue those who seek to enrich themselves by diverting critical healthcare resources from where they are truly needed.”
The defendant faces up to 20 years in federal prison and a fine of not more than $250,000 or twice the pecuniary gain/loss caused by her actions. She further faces forfeiture of any property constituting, or derived from, or traceable to, the proceeds obtained, directly or indirectly, from the fraud, including, but not limited to a money judgment in an amount of at least $8,293,611.00. A federal district court judge will determine any sentence after considering the US Sentencing Guidelines and other statutory factors. A date for sentencing has not been set.
Compliance Perspective
Issue
Failure to have a system that uses generally accepted accounting principles (GAAP) with appropriate checks and balances and an annual audit conducted by an independent Certified Public Accounting (CPA) firm, may be considered neglect of the facility’s fiduciary duty to protect residents’ financial assets and the assets of the facility, in violation of state and federal laws. Every nursing facility should have a double check system in place for monetary transactions and the purchasing of supplies. All transactions should be legal and checked and approved by a second party to prevent misappropriation of funds. Misappropriation of funds can result in fines, other sanctions, and imprisonment.
Discussion Points
- Review policies and procedures to ensure that a system of checks and balances is in place to prevent one person from being able to both approve invoices and write checks, and further embezzle funds.
- Train staff involved in the facility’s accounting and billing departments to be aware, to question, and to report to their supervisor or through the Hotline any reasonable suspicion of criminal behavior.
- Periodically audit the facility’s and residents’ financial accounts, company invoices, bank statements, and credit card accounts to discover possible misuse and embezzlement of funds. Immediately address any potential concerns.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
