U.S. District Court Judge Curtis Gomez sentenced Rodney Miller, the former chief executive officer of Schneider Regional Medical Center, to 21 months in federal prison for income tax fraud, Tuesday.
According to the U.S. Attorney’s Office for the District of the Virgin Islands, a federal jury convicted Miller in September 2013. The jury found Miller willfully filed his 2006 income tax return in 2007, falsely reporting total income of $265,198 while knowing his true total income was $510,947.
Miller faced a maximum penalty of three years in prison, a maximum fine of $250,000 and a special assessment of $100.
The government initially alleged Miller filed 2006 and 2007 tax returns with the V.I. Internal Revenue Bureau that he knew were false. He reported total 2006 income of $265,000 and 2007 income of $256,000 but knew it was "substantially more," according to the indictment. However the government moved to dismiss the second charge, saying it was not the proper venue.
Miller’s 2007 tax return was filed with the U.S. Internal Revenue Bureau, while the 2006 return was filed with the V.I. Internal Revenue Bureau. The charge was dismissed without prejudice, meaning prosecutors have the option to refile the charges or file them in a different venue. The court record indicates the court severed the 2007 tax return charge for prosecution in Florida, where Miller was living at the time.
The federal tax charges relate to local charges that Miller and top hospital executives Amos Carty Jr. and Peter Najawicz defrauded Schneider Regional Medical Center of millions of dollars. Both previous trials on those charges ended in mistrials. The V.I. Supreme Court has stayed the case until it rules on a motion from Najawicz to dismiss the case on grounds it violates the U.S. Constitution’s ban on double jeopardy.
Prosecutors alleged Miller racked up almost $3.8 million by the end of his five years at the hospital, while Carty and Najawicz, who are accused of approving and making the payments, regularly received thousands more than the $80,000 salaries listed in their government payroll documents.
Miller’s tax fraud conviction stems from his not reporting all of that extra income to the Internal Revenue Service.
