Monday, February 4, 2019

AG says vulnerable clients were victimized a 2nd time

Attorney General Hector Balderas sounded the alarm Friday for more oversight of professional firms that handle money for vulnerable people, disclosing that his office has “credible evidence” that an Albuquerque company siphoned about $50,000 from nearly 250 clients after inheriting their cases from the now-defunct Ayudando Guardians Inc.

The AG’s allegations against Guardian Angels Representative Payee Services, located on San Pedro NE, represent the third time in less than two years that a private company entrusted to manage finances for special needs or otherwise vulnerable people has been accused of embezzling their funds.

No arrests have been made, but AG agents executed a search warrant Thursday at the firm and removed several dozen boxes of documents. The owner/operator of the company, Pamela Crumpler, had no comment Friday when contacted by the Journal.

Balderas cited the “critical investigation” of the firm in asking Gov. Michelle Lujan Grisham in a letter Friday for her assistance in combating the “guardianship crisis in our State.”

“In the wake of this investigation and previous scandals,” Balderas wrote, “we have the opportunity to trigger all available state resources and create more oversight in these matters.”

He noted “systemic failures of state and federal governments that must be immediately addressed by all stakeholders.”

“The current lack of state regulation and oversight of guardianship and representative-payee services presents a clear and present danger of repeated exploitation of this population that deserves our immediate attention, intervention and protection,” he wrote.

Ayudando Guardians Inc., one of the state’s largest guardian and representative payee services firms, was closed by the U.S. Marshals Service in late August 2017 after its two principals and two family members were implicated in a $4 million embezzlement of client funds.

The four defendants are awaiting trial in federal court on money laundering, fraud and other charges linked to the scheme that prosecutors say supported a lavish lifestyle that included vacation cruises and luxury cars.

Ayudando’s estimated 1,400 clients were transferred by U.S. Marshals to other guardians or firms, like Guardian Angels, whose website states that it is a nonprofit corporation formed for “charitable purposes.”

As a representative payee, the company charges a monthly fee to receive clients’ Social Security or other government benefits, annuity payments or settlement proceeds, and pay their expenses for food, housing and other needs.

In the federal Ayudando case, prosecutors chiefly focused on the federal military veteran benefits allegedly embezzled.

Months before the Ayudando revelations broke in 2017, state securities regulators announced that more than 70 clients of Desert State Life Management of Albuquerque were the victims of a separate $4 million embezzlement.

The clients of that now-closed firm, which acted as conservator and fiduciary for developmentally or physically disabled and elderly individuals, are still trying to recoup their losses. Meanwhile Paul Donisthorpe, former CEO of the firm, is to be sentenced in U.S. District Court in Albuquerque on Feb. 22 after pleading guilty to money laundering and wire fraud.

In his letter to Lujan Grisham, Balderas stated that in December 2017 he received a request from Albuquerque’s state district court judges asking that his office review “certain civil guardianship matters which were not investigated or prosecuted federally.”

That resulted in the investigation of Guardian Angels Representative Payee Services, which inherited nearly 250 of Ayudando’s clients who needed help managing their funds. Balderas told the governor it was tragic that these individuals had been victimized after their cases were transferred by the U.S. Marshals to Guardian Angels.

Guardian Angels, like any other representative payee organization, “takes complete control over how these funds are expended, and where that money is ultimately deposited,” Balderas wrote in another letter Friday to officials with BBVA Compass Bank, based in Birmingham, Ala.

Guardian Angels is accused of taking advantage of a promotion by Compass Bank, in which the bank would deposit $200 into a newly created account that met the promotional requirements.

“Unfortunately,” Balderas wrote, the CEO of Guardian Angels “shifted the accounts of 247 vulnerable persons to BBVA Compass.” Then the CEO withdrew the $200 promotion from each account and deposited the funds into “an account only she had control of.”

“Investigators in my agency have probable cause to believe that the CEO of GARP converted these funds to her own personal use, to the detriment of these vulnerable persons, to pay her own personal financial obligations,” stated Balderas’ letter to the bank.

In an affidavit to search the company’s premises, an AG investigator stated that during a guardianship hearing before state District Judge Shannon Bacon of Albuquerque last September, the court-appointed guardian from Professional Guardianship Associates told the judge she had concerns about a protected person’s bank account.

Guardian Angels had been appointed to act as representative payee a year earlier for that individual, and the guardian learned the protected person’s bank account had been transferred to Compass Bank without notifying the guardian.

When she inquired of Guardian Angels about the $200 bonus, the guardian was told there had been a mistake by the bank and the money should have gone directly to the representative payee firm.

After the judge was told of the discrepancy, Guardian Angels transferred the $200 back into the protected person’s account. That prompted the AG search of other clients’ accounts.

A search warrant executed last November by the AG showed expenditures and transaction that Guardian Angels “would not have been able to conduct … had it not been for the bonus money GARP unlawfully obtained from 247 of its clients,” the AG investigator stated in an affidavit.

Full Article & Source:
AG says vulnerable clients were victimized a 2nd time

1 comment:

Betty said...

For many, it may be the third time. .. first by family, then by guardianship, and then by guardianship again.