PHILADELPHIA (CN) – The ex-general counsel of the Children’s Hospital of Philadelphia faces up to seven years in prison after pleading guilty Wednesday to an embezzlement scheme that lasted over a decade and cost the institution about $1.7 million.
Roosevelt Hairston Jr., who worked for the organization in various high-ranking capacities, most recently as general counsel and executive vice president, stole roughly $225,000 from the nonprofit by submitting about 33 fraudulent invoices between December 1999 and December 2003, federal prosecutors said.
The fake invoices requested payment for fictitious expert-witness services that Hairston claimed were used to defend medical-malpractice claims against the hospital, according to an information filed in early June.
Hairston, 46, had to stop the scheme when he could no longer unilaterally approve the invoices, but he resumed in earnest in June 2007 on a larger scale, according to the information.
Hairston created shell companies and submitted nearly 100 bogus invoices to the hospital between June 2007 and mid-February 2011, falsely claiming the companies provided the hospital with more than $1.5 million in services, prosecutors said.
When hospital personnel inquired about errors in the sham invoices, Hairston’s scheme became even more elaborate.
Hairston stole the identity of an unwitting close friend, created multiple bogus email addresses and used his parents’ former Maryland address to conceal the fact that one of the companies, L&S Data, was merely a shell, the government said.
Hairston posed as an L&S Data official to email the hospital that the company was ceasing operations and that the purported official had landed a position with the governor of Virginia, according to the information.
The ill-gotten funds bankrolled a lavish lifestyle that included a captained yacht and high-end automobiles, according to the information, which charged Hairston with mail fraud, money laundering and filing a false tax return.
Hairston also used these funds to pay two mortgages on his reportedly 7000-square-foot Malvern, Pa., home, according to the information.
Hairston’s new home will likely look far different.
Sentencing is set for October.
Hairston was granted bail, and a $700,000 bond has been provided to the court on his behalf, court records show.
He may be required to pay restitution and up to $1 million in fines, according to the U.S. Attorney’s Office.