For the second time in a year, a former chief executive officer of Vallejo, Calif.-based Redwood Family Clinic, now called La Clinica Vallejo, has admitted to embezzling thousands of dollars and then filing false tax returns to cover it up.
Osa Marie Healy, 44, this month pleaded guilty to two felony charges of having falsely omitted from her tax returns some $92,400 she had embezzled from the not-for-profit clinic from February 1999 to May 2001.
Healy, who was also a board member, admitted to writing more than 100 unauthorized checks to herself and using the money to pay for her mortgage, kitchen appliances and construction of a $15,000 pool. As part of a plea bargain, she agreed to pay full restitution in exchange for the dismissal of 30 embezzlement charges.
"Embezzled money is taxable income to the person that took it," said Mark Lessler, public information officer for the criminal investigation division of the Internal Revenue Service. "This is one of the types of cases the taxpaying public really likes the IRS to investigate."
Healy faces a maximum of six years in prison, one year of probation and a $500,000 fine. If the embezzlement charges had not been dropped, she could have faced up to 306 years in prison and $7.7 million in penalties. The clinic, which serves the poor and uninsured, receives funding from Medicare and Medicaid, making its defrauding a federal crime. Sentencing is scheduled for Sept. 29 in Sacramento, Calif.
This is the second prosecution of the clinic's CEO within a year. Healy's predecessor, Lisa Jo Baird, was sentenced in 2003 to six months in jail and ordered to pay $187,367 in restitution after pleading guilty to one count of embezzlement and one count of filing a false tax return.
In her plea agreement, Baird, 42, admitted to writing more than 100 unauthorized clinic checks to herself from 1996 to 1998 while serving as the clinic's CEO and treasurer and then failing to report the additional income on her 1998 tax return. The money had been used to pay for clothes, ski trips, a health-club membership and overdue parking tickets.
Healy served on the clinic's board while Baird was administrator. But Lessler said he could not confirm whether the two women had known of the each other's illegal activities.
Officials at the clinic didn't return calls seeking comment.