The remaining question is: Who are the other conspirators and their role in this? When will the next shoe drop?
It seems to me that Boettcher had very little to gain financially by choosing to mislead regulators and the trustees of FAHC. 'Following the money' would suggest that other conspirators, and Boettcher also may have had something to gain financially from this.
Merely lying and covering up the facts to prevent the regulators or the trustees from denying or delaying the project seems little reward compared to the risk of the penalties involved in breaking the law. There must be more here we don't yet know.
++++++++++++++++
January 18, 2005
FORMER HOSPITAL CEO WILLIAM V. BOETTCHER PLEADS GUILTY TO FEDERAL FELONY IN AGREEMENT WITH FEDERAL AND STATE OFFICIALS
The Offices of the United States Attorney for the District of Vermont and the Vermont Attorney General jointly stated today that William V. Boettcher, 57, the former Chief Executive Officer of Fletcher Allen Health Care, Inc. (FAHC) in Burlington, Vermont pleaded guilty to the federal felony of conspiring to make false statements in a health care matter, in violation of 18 U.S.C. §§ 371 and 1035, on charges arising from fraud in connection with the construction of the FAHC “Renaissance Project.”
In United States District Court, before Chief Judge William K. Sessions, III, Boettcher admitted to conspiring with others to conceal and cover up the true costs of the Renaissance Project. Boettcher and others entered into a conspiracy to conceal and cover up the true costs of the Renaissance Project from both the Vermont Department of Banking, Insurance, Securities and Health Care Administration ("BISHCA") and the FAHC Board of Trustees. Pursuant to this conspiracy, Boettcher and others misrepresented to BISHCA that the cost of the FAHC Renaissance Project was $173 Million, when the real capital costs to FAHC exceeded this amount by over $80 million. In addition, the conspirators also provided false information to the FAHC Board of Trustees relating to the cost of the project.
According to court records, during Boettcher’s tenure as FAHC CEO, he and others participated in a variety of frauds regarding project costs. To begin with, the conspirators agreed to, and did, create two budgets for the Renaissance Project, one for presentation to BISHCA, and one for internal purposes reflecting the real costs of the project. The conspiracy also involved the submission of a false financial model to BISHCA as part of the application submitted by FAHC in 2000 for approval to build the Renaissance Project. This financial model falsely described the total cost of the project as $173 million. During 2000, the conspirators also failed to tell the FAHC Board of Trustees the full cost of the project. Furthermore, after obtaining the BISHCA approval that had been based upon false information, FAHC continued to misrepresent the costs of the project by, among other things, claiming in an implementation report filed with BISHCA in late 2001 that the costs of the project continued to be approximately $173 million. The conspirators also sought to prevent additional BISHCA review of the project by falsely claiming that FAHC had obtained a “guaranteed maximum price” construction agreement that would allow the project to be built for the amount approved in the CON, $173 million. During 2001 and early 2002, the conspirators also falsely maintained to the FAHC Board of Trustees that the project was on budget. Finally, the conspirators concealed from the FAHC Board of Trustees the full cost to FAHC of the agreement with the University of Vermont to develop the education center component of the project.
As part of the plea agreement, Boettcher may be sentenced to up to two years in federal prison. Sentencing will be scheduled for April 18, 2005 . Boettcher also agreed to pay FAHC $733,210.21 prior to his sentencing – the same amount that FAHC paid him upon the termination of his employment in September 2002. If he abides by the terms and conditions of the agreement Boettcher will face no additional financial penalties. The plea agreement is subject to the approval of Chief Judge Sessions. Under the agreement, both federal and state authorities agree not to bring additional criminal or civil charges against Mr. Boettcher relating to the Renaissance project."
According to court records, during Boettcher’s tenure as FAHC CEO, he and others participated in a variety of frauds regarding project costs. To begin with, the conspirators agreed to, and did, create two budgets for the Renaissance Project, one for presentation to BISHCA, and one for internal purposes reflecting the real costs of the project. The conspiracy also involved the submission of a false financial model to BISHCA as part of the application submitted by FAHC in 2000 for approval to build the Renaissance Project. This financial model falsely described the total cost of the project as $173 million. During 2000, the conspirators also failed to tell the FAHC Board of Trustees the full cost of the project. Furthermore, after obtaining the BISHCA approval that had been based upon false information, FAHC continued to misrepresent the costs of the project by, among other things, claiming in an implementation report filed with BISHCA in late 2001 that the costs of the project continued to be approximately $173 million. The conspirators also sought to prevent additional BISHCA review of the project by falsely claiming that FAHC had obtained a “guaranteed maximum price” construction agreement that would allow the project to be built for the amount approved in the CON, $173 million. During 2001 and early 2002, the conspirators also falsely maintained to the FAHC Board of Trustees that the project was on budget. Finally, the conspirators concealed from the FAHC Board of Trustees the full cost to FAHC of the agreement with the University of Vermont to develop the education center component of the project.
As part of the plea agreement, Boettcher may be sentenced to up to two years in federal prison. Sentencing will be scheduled for April 18, 2005 . Boettcher also agreed to pay FAHC $733,210.21 prior to his sentencing – the same amount that FAHC paid him upon the termination of his employment in September 2002. If he abides by the terms and conditions of the agreement Boettcher will face no additional financial penalties. The plea agreement is subject to the approval of Chief Judge Sessions. Under the agreement, both federal and state authorities agree not to bring additional criminal or civil charges against Mr. Boettcher relating to the Renaissance project.
In October 2003, FAHC entered into an agreement with the United States and the State of Vermont settling civil charges that the federal government brought against FAHC relating to the Renaissance Project. Pursuant to that agreement FAHC agreed to cooperate completely, candidly and truthfully with the investigation related to the Renaissance Project. FAHC has cooperated fully and continues to cooperate with the ongoing investigation.
October 2004, FAHC’s former Chief Operating Officer, Thad Krupka, pleaded guilty in state court to three counts of making false statements to BISHCA in connection with the Renaissance Project, as well as agreeing to federal forfeiture of portions of his FAHC remuneration. Mr. Krupka also agreed to cooperate with the ongoing investigation.
The investigation of the Renaissance Project remains ongoing. Paul Van de Graaf, Chief of the Criminal Division of the United States Attorney’s Office, Assistant United States Attorney Michael Drescher, and Assistant Attorney General John Treadwell, of the Vermont Attorney General’s Office, have been handling the prosecution with the assistance of the Federal Bureau of Investigation and the Office of Inspector General of the Department of Health and Human Services. Jerome O’Neill, Esq. of Burlington, represents Mr. Boettcher.
No comments:
Post a Comment