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2017-01-20 20:20:22
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2017-01-20 17:42:32
Local news — St. Thomas
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Miller Trial Zeros in on $2 Million from Hospital Account

Prosecutors and defense attorneys spent most of the morning Friday battling over witness testimony that uncovered more than $2 million in disbursements to former Schneider Regional Medical Center head Rodney Miller Sr. from a hospital account at Scotia Bank.

The Scotia Bank account is at the heart of embezzlement and corruption charges levied against Miller and his two co-defendants, former hospital Chief Executive Officer Amos Carty Jr. and former Chief Financial Officer Peter Najawicz, who have all been accused of working together to award one another lavish pay packages and perks above and beyond their official government salaries.

Prosecutors have described the Scotia Bank account as the former exec's own personal "slush fund," where large amounts of money were funneled in and out to their own private accounts. Some of the larger transactions were examined Friday, as bank account officer Reid Brett said that at least one $250,000 transaction "raised a red flag" at the bank.

The transaction was one of three seen on statements from May 2005, which included two payments of $250,000 and a third of $466,456 to Miller, which were paid -- as all transactions from the account were -- by Najawicz.

"It was a large transaction, so it required a check from the bank to see what it was for," Brett testified. He added that he subsequently e-mailed Najawicz, who said it was for "professional services" rendered to the hospital. The transactions referenced by the prosecution also included Carty and Najawicz, and ran until November 2007, with amounts ranging from $400 to $26,312. Miller is the only one among the three who received six-figure payments.

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Miller, Carty and Najawicz, along with former hospital board chairwoman June A. Adams, were all signatories on the account, which was set up in 2005.

Calculator once again in hand, Miller defense attorney Alan Teague asked Brett to go through the figures with him, adding up sums that reflect totals included in a number of e-mails sent from Miller to Najawicz directing that the payments be made. Teague did the same thing Thursday with Gail Ferreira, a financial manager at the hospital, who calculated the payments based on the benefits included in Miller's 2005 and 2007 employment contracts with the hospital.

Prosecutors have contended, however, that one of the 2005 contracts "did not exist," and was in fact drafted by Carty at Miller's request. Teague has also argued that the second contract was a "placeholder" while the first contract was being renegotiated.

Under questioning from Teague Friday, Brett said he did not know what benefits were included in Miller's contract, which, among other things, contained a variety of incentive bonuses and allowances -- some of which were to be made biweekly in concurrence with the hospital's pay periods. Referencing two payments of $6,153 made to Miller in August of 2007, Teague asked Brett to multiply that figure by 26 -- the number of pay weeks in the calendar year -- and asked him to subtract that figure from the $310,000 base salary listed in one of Miller's signed offer letters from the hospital.

"You get $150,000, correct?" Teague asked. "And that's the same $150,000 in Mr. Miller's NOPA."

NOPAs, or Notices of Personnel Action, are official government documents that outline, among other things, what a government employee's position is and how much they are being paid. Throughout the case, prosecutors have argued that Miller's official government salary has been recorded at $150,000, while defense attorneys have said there is a difference between what was included in the officials' NOPAs and what each of their base salaries, offered by the hospital, was.

Teague has continued to reference at least five other hospital employees he said were making above their NOPA pay grade -- one of whom also took the stand Friday. Under cross-examination, Teague had Brett confirm a variety of electronic transfers made to Angela Rennalls-Atkinson, whose payments started from the Scotia account in 2006 when she was brought on as the hospital's vice president of nursing and patient care services.

Under questioning from Teague, Brett said that when opening the account, the former officials were clear about what they wanted to use it for, and none of their transactions appeared to go beyond the scope of that description.

While Brett received no questions from Carty attorney Anthony Chambers -- who said the bank documents have already been testified to repeatedly over the past few days -- Najawicz defense counsel Robert King asked if his client did "everything required" of him to open the account and process the payments.

"Yes," Brett said, adding under more questioning from King that he was not here "to pass judgment on" the transactions since he did not know what raises, bonuses or allowances were included in Najawicz's contract.

Rennalls-Atkinson was called to the stand late in the afternoon, and testified under questioning from prosecuting attorney Esther Walters that she came to the hospital after being recruited by a search firm in 2003. Rennalls-Atkinson said after meeting with Miller, she turned down the hospital's first offer of $80,000 but accepted the second because she was told that there would be a possibility for future bonuses.

It wasn't until 2006 that Rennalls-Atkinson, who said she went to Miller on occasion to ask for a raise, received a bump up to $120,000 -- a figure that she testified was never reflected in her NOPA. Rennalls-Atkinson added that the hospital, at first, did not appear to be withholding taxes from her checks, so she eventually met with the accounting division to get the situation rectified.

Salary payments were made through electronic transfer to a personal Chase Bank account, Rennalls-Atkinson said.

Rennalls-Atkinson eventually moved into the position of chief operating officer (COO) when Carty took over as the hospital's head in 2007, and it was then that she was added on as a signatory to the Scotia Bank account. Looking over documents provided by Walters Friday, Rennalls-Atkinson said she recognized her signatures and copies of two identification cards attached to the account documents, but could "not honestly say" what each paper said.

"Do you recall ever being a signatory on a Scotia Bank account?" Walters asked.

"No, I don't," Rennalls-Atkinson responded.

"Did you ever sign any documents relating to the account?" Walters asked.

"Not that I recall," Rennalls-Atkinson said, adding that she also did not make payments from the account, and never directed anyone to make payments from the account.

Under questioning from Teague, however, Rennalls-Atkinson said she became a certifying officer of the hospital when she took the position as COO, and was therefore a signatory on many of the hospital's accounts since she would, if Carty were absent or unavailable, have to sign off on various financial and other documents.

Rennalls-Atkinson added later that it would not "strike her as odd" to see her name on any account at the hospital, and may not have remembered signing certain papers because she has signed hundreds, if not thousands, of documents over the years.

Under questioning from Teague about her salary, Rennalls-Atkinson said she was, in her new position, offered a raise to $175,000 from Carty, and got as far as receiving an offer letter to that effect. The raise was never enforced, but it was not clear why that was, as later questions from Walters under redirect were buried under objections from the defense.

Rennalls-Atkinson said she is now being paid $95,000 and under questioning from Teague said that "in the real world," a bump up to a higher position usually comes with more money. She said the same thing in response to questions from Carty defense attorney Anthony Chambers, adding that she is still making less than what she earned at her previous job in New York.

Rennalls-Atkinson said she stayed on at the hospital because she believes she can still do some good for the patients, but believes -- in response to Chambers' questions about recruitment and retention efforts at the hospital -- that she is underpaid.

"You thought that every penny, every dime you were to get, you earned it, didn't you?" Chambers asked.

"Correct," Rennalls-Atkinson replied.

Walters got the last word in, however, and returned to the subject of the $175,000 contract that was never enforced. While she was hampered by the defense objections about what happened, she did manage to ask if there ever came a time when Rennalls-Atkinson learned that she "was not going to be paid under the contract."

Objections about speculation were shouted out immediately when Rennalls-Atkinson began to talk about what she had been told, leaving her with no choice but to answer yes or no.

"No," she replied in response to Walters' question.

The trial picks up again 9 a.m. Tuesday.

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