Embezzler sentenced to two years in prison for raiding patient funds

Press release from Indiana Attorney General Greg Zoeller:

Embezzler sentenced to two years in prison for raiding patient funds
Attorney General: businessman violated trust of our most vulnerable communities

(INDIANAPOLIS – May 28, 2010) – Today in Allen County, the owner of a chain of group homes for developmentally disabled residents was sentenced to two years in prison, after he was convicted of the theft of approximately $75,000 in patient trust funds.

The Medicaid Fraud Control Unit of the Indiana Attorney General’s Office investigated the trust-fund embezzlement case against the company owner, Ernest M. Beal Jr. Convicted of Class D felony theft, Beal was sentenced today in Allen County Superior Court to two years in prison.

“Families of developmentally disabled patients put their trust in this individual, and he repaid their trust by pocketing their money. These were funds the families and the patients had set aside for personal expenses to provide for a good quality of life,” Indiana Attorney General Greg Zoeller said. “To steal from the developmentally disabled and call it a ‘loan’ is the height of cynicism and deserves prison time.”

Beal, 57, is an attorney and was CEO of Your Friends & Neighbors, a company that operates group homes for the developmentally disabled in Indiana and Georgia. The Attorney General’s Medicaid Fraud Control Unit (MFCU) has the legal authority to investigate thefts involving group-home residents’ trust funds.

MFCU investigators reviewed allegations that between February 2006 and September 2008, Beal raided the trust funds of approximately 150 residents of his Indiana group homes and used the money for payroll – including his own. The trust funds — comprised of Social Security income, paychecks and spending money that families had provided — should have totaled $115,000, yet at one point the funds had been drained to $7,000 because of Beal’s embezzlement, the investigation found.

When questioned by investigators, Beal claimed the unauthorized taking of funds was a “loan” and he had repaid part of the money, but $75,000 still was owed. Once MFCU investigated the case, the Allen County Prosecutor’s Office filed a theft charge against Beal in June 2009.

After a trial lasting several days, a jury on April 22 convicted Beal of the Class D felony count, and Judge Fran Gull sentenced him to two years in prison.

Zoeller thanked Allen County Prosecutor Karen Richards, Chief Deputy Prosecutor Mike McAlexander and Deputy Prosecutor Tim McCauley for seeing the criminal case through to trial. Zoeller also thanked MFCU investigators Dorsey Kane, Tom Trenerry and Tina Hampshire and Deputy Attorney General Drew Adams for their efforts in reviewing the finances and untangling the records.

“With his disregard for other people’s property, this individual had to be held accountable – and that required a seamless coordinated effort by the Medicaid Fraud Control Unit and our partners in the Allen County Prosecutor’s Office,” Zoeller said. “Anyone who considers embezzling from the most vulnerable among us should recognize the State of Indiana finds that intolerable.”

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