Preferred Family Healthcare to forfeit $8M in non-prosecution agreement

Springfield-based nonprofit Preferred Family Healthcare will pay more than $8 million to the federal government and the state of Arkansas as part of a non-prosecution agreement, according to a U.S. Department of Justice press release on Thursday.

Former Preferred Family Healthcare employees were accused of embezzling funds from the charity to bribe Arkansas lawmakers, as well as funneling charity funds to contribute to Missouri politicians.

Those employees have since been fired, and replaced with a leadership team "that values compliance, accountability, and transparency," according to a statement from Preferred Family Healthcare. The organization said it also instituted a compliance program that aims to "deter and detect fraud and illegal actions."

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“Preferred Family Healthcare must relinquish the illegal profits it garnered from a wide-ranging fraud and bribery scheme,” said U.S. Attorney Teresa Moore for the Western District of Missouri. “Several former officers and employees are being prosecuted in separate criminal cases for their individual criminal conduct. This non-prosecution agreement holds the charity itself responsible for their actions as agents of the charity. Public tax dollars were stolen and misused in the course of this public corruption scheme, and through this agreement and these separate prosecutions, those dollars are being restored to the public coffers.”

According to the release, Preferred Family Healthcare will forfeit more than $6.9 million to the federal government and pay more than $1.1 million in restitution to the state of Arkansas for misuse of funds from the state’s general improvement fund.

More: Executives of Springfield nonprofit linked to $1 million in illegal political activity

Preferred Family Healthcare provides a variety of services like counseling and treatment for mental health and substance abuse, employment assistance, services for people with developmental disabilities and medical services to those in Missouri, Arkansas, Kansas, Oklahoma and Illinois.

Most of the charity's funding is from federal funds, with the largest portion being Medicaid reimbursement, according to the press release.

“The misuse and misappropriation of millions of federally sourced funds, designated for employment training and behavioral healthcare services to the public, by former executives of Preferred Family Healthcare is a gross abuse of the positions of trust they once held within the organization,” said Special Agent-in-Charge Steven Grell of the U.S. Department of Labor, Office of Inspector General, in the press release. “These former executives failed the public and did a disservice to PFH employees by prioritizing their own personal benefit and financial gain over the public they served. Today’s agreement demonstrates PFH’s willingness to take corrective actions regarding the criminal actions of former executives of the organization.”

Several former charity executives, former Arkansas state legislators and others have pleaded guilty as part of the federal investigation.

"PFH is now in a much stronger organization than it was when the investigation began," Preferred Family Healthcare said. "We look forward to continuing to improve the health and wellness of the thousands of clients we serve."

The following individuals were charged in connection with the case:

  • Former Chief Executive Officer, Marilyn Luann Nolan of Springfield, Missouri, pleaded guilty to her role in a conspiracy to embezzle and misapply the funds of a charitable organization that received federal funds. A sentencing hearing has not been scheduled.

  • Former Director of Operations and Executive Vice President Robin Raveendran, of Little Rock, Arkansas, pleaded guilty to conspiracy to commit bribery concerning programs receiving federal funds. A sentencing hearing has not been scheduled.

  • Former employee and head of operations and lobbying in Arkansas, Milton Russell Cranford, aka Rusty, of Rogers, Arkansas, was sentenced to seven years in federal prison without parole after pleading guilty to one count of federal program bribery.

  • Political Consultant Donald Andrew Jones, aka D.A. Jones, of Willingboro, New Jersey, pleaded guilty to his role in a conspiracy from April 2011 to January 2017 to steal from an organization that receives federal funds.

  • Former Arkansas State Senator Jeremy Hutchinson, of Little Rock, Arkansas, pleaded guilty to conspiracy to commit federal program bribery. A sentencing hearing has not been scheduled.

  • Former Arkansas State Representative Eddie Wayne Cooper, of Melbourne, Arkansas, pleaded guilty to conspiracy to embezzle more than $4 million from Preferred Family Healthcare. A sentencing hearing has not been scheduled.

This article originally appeared on Springfield News-Leader: Preferred Family Healthcare to pay $8M in non-prosecution agreement