Federal officials on Monday announced that former chief executive and owner of Chicago's now closed Edgewater Hospital and Medical Center and his lawyer were indicted for allegedly lying and obstructing justice in the government and a bank's efforts to collect $188 million involving fraud, according to a Federal Bureau of Investigation (FBI) press release. The CEO and his wife allegedly received millions from an offshore trust, reports the ABA Journal.
The U.S. state attorney and the FBI announced that former chief exec Peter G. Rogan and attorney Frederick M. Cuppy were each charged with one count of conspiracy to obstruct justice. Cuppy also was charged with three counts of perjury and three counts of obstruction of justice.
The hospital closed in 2001 and entered bankruptcy in 2002. The management company, the vice president, and four physicians pleaded guilty to healthcare fraud regarding referral kickbacks and unnecessary hospital admissions, tests, and services.
Although Rogan wasn't charged at that time, in 2002, the U.S. filed suit against him for allegedly submitting false Medicare and Medicaid claims worth millions of dollars. In 2006, a judge found Rogan falsely testified, destroyed documents, and obstructed justice, a decision that was upheld in 2008. The U.S. entered a judgment against Rogan for more than $64 million.
In addition, the bank Dexia Crédit Local in 2002 filed suit against the CEO and his companies after financing Edgewater Medical Center. In 2007, Dexia was awarded a judgment of more than $124 million.
The ex-CEO and attorney could face up to 20 years in prison per count of obstruction of justice and five years for each count of perjury, as well as a maximum fine of all charges of $250,000 per count, according to the press release.
For more information:
- read the FBI press release
- read the Chicago Tribune article
- read the ABA Journal article