The former financial manager and former chief financial officer of now-defunct Youngstown (Ohio) Osteopathic Hospital have been convicted on criminal charges after a two-week jury trial for their involvement in a fraud scheme. Richard White, 61, the financial manager, was found guilty of 14 counts of Medicare fraud, money laundering and wire fraud. The hospital's former CFO, Michael Suhadolnik, 48 -- who was hired by White -- was found guilty of one count of wire fraud. White, Suhadolnik and three others were indicted in 2003 for allegedly conspiring to funnel money from the not-for-profit hospital to five mental health clinics in Florida between 1996 and 1998. The clinics also allegedly billed Medicare for inflated operations expenses. Raul Sanchez de Varona, a Florida lawyer, pleaded guilty to conspiracy charges in October 2003. Two other defendants await trial.
White was hired by the hospital in 1996 to provide financial management services and establish a provider network to generate business for the hospital. A company owned by White charged the hospital management fees for the network. It was unclear whether the hospital board knew the network included clinics in Florida or of White's financial interest in the clinics. The hospital filed for Chapter 11 bankruptcy protection in 1999 and closed the following year. Under federal sentencing guidelines, White likely will receive five years of prison time and Suhadolnik three years, said the prosecutor of the case, Assistant U.S. Attorney Jim Lynch in Cleveland. -- by Mark Taylor