VENTURA, CALIF. (CN) - The Community Memorial Health System claims its outside accountants and its general counsel cost it a $1.5 million fine by concealing the fraudulent use of millions of hospital dollars by its executive director.
The plaintiff, formerly known as Community Memorial Hospital of San Buenaventura, sued Bartlett Pringle & Wolf, its former accountants, and the hospital's former general counsel, Peter Goldenring, and his law office, Goldenring & Prosser.
The hospital claims its former executive director, Michael Bakst, submitted fraudulent claims for hundreds of thousands of dollars in personal expenses, and misused hospital money to pay staff members, in violation of Medicare regulations.
The hospital claims Goldenring, as Bakst's personal attorney, as Bartlett Pringle to conceal Bakst's actions from the board, and that the accountants let Goldenring alter its report, deleting findings that would damage Bakst.
The hospital claims it gave Bakst a favorable settlement with a multi-million dollar severance payment and a full release of claims that it would not have done if the defendants had not concealed Bakst's actions.
It claims it has had to investigate and self-report the misconduct to the Department of Justice and Department of Health and Human Services, and was fined $1.5 million. It demands that money, plus punitive damages.
It is represented by Brown & White of Los Angeles. This Superior Court complaint, filed on May 14, was just made available by the court.
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