The former owner and CEO, Peter Rogan, 65, is free on bail and living in Vancouver, British Columbia, awaiting immigration proceedings in Canada. Rogan, who formerly lived in Valparaiso, Ind., was charged criminally in an indictment that was unsealed in 2008 (PDF) and today faces charges including conspiracy to obstruct justice, actual obstruction and perjury.
Four physicians, a vice president and Edgewater’s management company pleaded guilty to fraud involving paying kickbacks for patient referrals and medically unnecessary treatments in 2002—about the same time the hospital filed for bankruptcy, according to a news release from the U.S. attorney’s office in Chicago (PDF).
Rogan was sued civilly by the federal government in 2002 for the fraud, and found liable for $64 million in losses in a 2006 bench trial that was upheld in 2008 by the 7th Circuit Court of Appeals in Chicago. Separately, the European bank Dexia Credit Local, won a $124 million judgment against Rogan to recover loans it made for the hospital.
During that time, federal authorities say Cuppy and Rogan conspired to hide Rogan’s assets in private trusts that he claimed to have no control over, even though more than $11 million was distributed to Rogan and his wife between 2002 and 2006. Prosecutors say Cuppy falsely told investigators that he had not instructed the trustee of one trust of disburse the money to Rogan’s wife or to conceal documents from creditors.