Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Hospital Employees Sentenced to Prison Time for Involvement in Fraud Schemes, (Oct 18, 2012)

By Jeffrey May, J.D.

Two former employees of New York Presbyterian Hospital (NYPH) were sentenced on October 17 for their roles in fraud schemes related to facilities work contracts performed at the hospital, the Department of Justice has announced (U.S. v. Santo Saglimbeni, Emilio Figueroa, Case No. 10 CRIM 363, Daniels, G.). The charges resulted from a Department of Justice antitrust investigation of bid rigging, fraud, bribery, and tax-related offenses relating to the award of facilities contracts at NYPH. Some contracts related to repairs for heating, ventilation and air conditioning (HVAC) systems and others related to asbestos abatement projects.

Santo Saglimbeni, a former vice president of facilities operations at NYPH, was sentenced to serve 48 months in prison and ordered to pay a $250,000 criminal fine. Emilio "Tony" Figueroa, a former director of facilities operations at NYPH, was sentenced to serve 36 months in prison and ordered to pay a $25,000 criminal fine. Saglimbeni and Figueroa were ordered to jointly and severally pay $603,982 in total restitution to NYPH. In addition, the court issued a preliminary order of forfeiture for $2.3 million, which included certain bank accounts into which the kickback money from one of the schemes was deposited, as well as a parcel of land purchased with a portion of the money.

The two individuals were originally indicted by a New York City federal grand jury in April 2010. Superseding indictments followed.

In February 2012, after a four-week trial, Saglimbeni and Figueroa along with others were convicted of engaging in a wire fraud conspiracy to defraud NYPH. Saglimbeni also was convicted of a wire fraud violation.

The Justice Department said that the evidence presented at trial showed that the scheme to defraud NYPH centered on Saglimbeni, who with the assistance of Figueroa, awarded asbestos abatement, air monitoring and general construction contracts to co-conspirators in return for more than $2.3 million in kickbacks paid to Saglimbeni.

On July 31, 2012, Saglimbeni and Figueroa each pleaded guilty to additional mail fraud conspiracy and mail fraud violations. These charges were part of the same indictment but had been severed and had been scheduled for a separate trial earlier this year. According to the charges, the fraud scheme also centered on Saglimbeni, who with the assistance of Figueroa, awarded HVAC contracts to an HVAC vendor in return for kickbacks.

“Today's sentences are consistent with the serious nature of the crimes for which the individuals were convicted,” said Joseph Wayland, Acting Assistant Attorney General Joseph Wayland in charge of the Department of Justice Antitrust Division, in announcing the sentencing. “The division remains committed to holding accountable corrupt purchasing officials who undermine the competitive bidding process for their personal gain.”

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