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MALTREATMENT INVESTIGATION MEMORANDUM Minnesota Statutes, section 626.557, subdivision 1 states, “The legislature declares that the public policy of this state is to protect adults who, because of physical or mental disability or dependency on institutional services, are particularly vulnerable to maltreatment.”
License Number and Program Type: 1053325-AFC (Adult Foster Care) 1071548-HCBS (Home and Community-Based Services) Investigator(s): Jason Pehler 651-431-4830 Suspected Maltreatment Reported: It was reported that a staff person (SP) was check “kitting” money from a joint bank account s/he held with a vulnerable adult (VA) by writing checks from the account to him/herself and family members and depositing or cashing the checks into accounts not owned by the VA. In addition, some of the VA’s paychecks were deposited into the SP’s bank account and approximately $10,000 in cash was withdrawn from the VA’s bank account. Date of Incident(s): Multiple incidents dating back to 2022 Nature of Alleged Maltreatment Pursuant to Minnesota Statutes, section 626.557, subdivision 9c, paragraph (b), and Minnesota Statutes, section 626.5572, subdivision 15, and subdivision 9, paragraph (b), clause (1): In the absence of legal authority, a person willfully uses, withholds, or disposes of funds or property of a vulnerable adult. Summary of Findings: Pertinent information for this investigation was obtained remotely, including documentation from the facility, bank records, and law enforcement records; and through interviews conducted with the VA, the VA’s case manager (CM), a bank staff person (BSP), and the SP. The VA was diagnosed with developmental disabilities and had a history of seizures. The VA received income from his/her employment at a Development Achievement Center and Supplemental Security Income. The VA had a bank account which the SP was an authorized co-account holder/owner (referred to as Bank A in this report). The VA’s client specific documentation showed the VA had limited reading, number, and money skills. The VA would not recognize mismanagement of his/her finances and would not report mismanagement of funds. The SP was to assist the VA with all financial matters. According to an internet search of Merriam-Webster.com; check-kiting was “the practice of drawing on uncollected funds during the time needed to clear a check deposited in a bank especially if the check is worthless.” This process was also called “kiting” and it was noted “check-kiting typically works this way: a check drawn on insufficient funds in one bank is deposited in a second bank, and the funds represented by the check are immediately withdrawn from the second bank. The money is ultimately deposited in the first bank to cover the check before it clears.” The BSP provided the following information: · The VA and SP had a joint account at Bank A; however, the account was rarely used until October 2022. Bank A noticed a concern when the account was over-drafted by a significant amount. Bank A completed an investigation into the account, and it was believed check-kiting had occurred.
· Based on Bank A’s review of the account there was evidence the SP engaged in check-kiting between Bank A and Bank B (the SP and SP’s significant other had an account at Bank B). The BSP described the SP using a process of “floating” money back and forth to “inflate” the balance on the accounts, the funds that were moved back and forth were equal amount on the same day, all of which was “basically the definition of check-kiting.” The BSP said the SP appeared to engage in “textbook kiting” from the account as there were matching deposits and check payments. · The BSP said the account at Bank A over drafted multiple times which resulted in additional fees to the account, however there was no known loss of money to the VA beyond the overdraft fees because the money that was withdrawn was replaced with a deposit of equal money. The following information was obtained from LE Records, and records from Bank A and Bank B involving multiple banks and bank accounts: · The VA and the SP had a co-owned checking account at Bank A. · The SP and SP’s significant other co-owned one account at Bank B. The SP and SP’s family member co-owned another account at Bank B. The SP independently owned one account at Bank B. · Based on the review of the bank statements there was numerous instances of the accounts at Bank B transferring money back and forth, as well as multiple overdraft fees, and account balances of near or below $0. · Banks statements from Bank A and Bank B showed multiple checks, withdrawals, money transfers, and/or purchases that caused overdrafts. · The VA was provided paychecks from his/her employer on a consistent basis (nearly bi-weekly) from December 2017 to March 2023. The majority of the VA’s paychecks were deposited into the account at Bank A which was owned by the VA and the SP. The total deposited amount was approximately $8,845. · There were multiple instances in which the VA’s paychecks and/or checks from the county were endorsed (signed the back of the check) by the VA and/or the SP. The checks were deposited into Bank B, which was owned by the SP and SP’s significant other (the VA was not a co-owner on the account at Bank B) including the following:
o The VA endorsed a check ($208.99) which was dated August 22, 2022. o The VA endorsed a check ($111), which was dated September 2, 2022. o The SP and the VA endorsed a check ($111) which was dated October 3, 2022. o The SP and the VA endorsed a check ($111) which was dated November 3, 2022. o The SP and the VA endorsed a check ($240.67) which was dated November 15, 2022. o The SP and the VA endorsed a check ($97.78) which was dated November 28, 2022. o The SP and the VA endorsed a check ($110) which was dated December 2, 2022. o The SP and the VA endorsed a check ($64.40) which was dated December 12, 2022. o The SP and the VA endorsed a check ($189.05) which was dated December 28, 2022. o The SP and the VA endorsed a check ($121) which was dated January 3, 2023. · There was no information within the bank records or facility records that the deposits of the VA’s paychecks above were transferred to the account the VA had access to or that the money was provided to the VA. · Bank statements from Bank A showed numerous withdrawals and surcharges from an automatic teller machine (ATM) in Hankinson, North Dakota. From June 2020 to November 2022, the total amount of money withdrawn from the VA’s account at Bank A at the specific ATM was over $10,000. An internet search showed the address on the bank statement matched that of a casino address. · Additional ATM withdrawals from Bank A occurred at other locations totaling over $1,500. · Bank B statements from the SP’s account showed numerous ATM withdrawals and purchases at the same address as that of the aforementioned casino. · On January 27, 2018, a check from Bank A was written to the SP for $200. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on February 5, 2018. · On February 15, 2018, a check from Bank A was written to the SP for $250. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on February 16, 2018. · On June 19, 2018, a check from Bank A was written to the SP for $450. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on June 19, 2018. · On July 10, 2018, a check from Bank A was written to the SP for $215. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on July 10, 2018. · On July 26, 2018, a check from Bank A was written to the SP for $200. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on July 27, 2018. · On September 17, 2018, a check from Bank A was written to the SP for $350. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on September 18, 2018. · On August 31, 2022, a check from Bank A was written to the SP for $975. The check was signed by the VA. The SP endorsed the check which was cashed or deposited at Bank B on August 31, 2022. On September 1, 2022, the SP wrote a check for “cash” from Bank B for $1,000. The SP made a cash deposit of $1,000 to Bank A on September 1, 2022. · On September 12, 2022, the SP wrote him/herself a check from Bank B for “cash” in the amount of $4,000. On September 14, 2022, a cash deposit of $4,000 was made to Bank A. Based on the other documents the SP wrote the SP’s name on the deposit slip. An additional deposit from the VA’s work paycheck ($149.27) was included in the deposit. The total deposit was $4,149.27 into Bank A. The SP wrote a check “Sept[ember]” (no date or year) to him/herself for $4,000 from Bank A. The check was signed by the SP. On September 13, 2022, the SP cashed/deposited the check at Bank B. On September 14, 2022, the check for $4,000 from Bank A’s account was processed. The check was written to the SP for $4,000, and was deposited at Bank B. · On October 11, 2022, a check from Bank A was written to the SP for $5,500. The check was signed by the SP. On November 8, 2023, the SP cashed/deposited the check at Bank B. · On November 9, 2022, the SP wrote a check for “cash” for $5,000 from Bank B. The SP deposited $5,000 in cash to Bank A the same day. On November 9, 2022, the SP wrote a check from Bank B to him/herself for $450, signed the check, and deposited it into Bank A account. The SP’s name and signature were on the deposit slip. · On November 10, 2022, the SP wrote a check from Bank A to his/her significant other for $800. The check was signed by the SP. On November 11, 2022, the significant other cashed/deposited the check at Bank B. · On November 14, 2022, a cash deposit of $1,000 was made into Bank B. The SP made a cash deposit of $800 into Bank A the same day. · On November 18, 2022, a check from Bank A was written to the SP’s family member for $6,000. The check was signed by the SP. The family member cashed/deposited the check at Bank B the same day. The check was returned due to insufficient funds. According to the bank statement after the check was initially cashed Bank A’s balance was $-5,991.14. · On December 17, 2022, a check from Bank A was written to the SP’s significant other for $1,800. The check was signed by the SP. On December 19, 2022, the significant other cashed/deposited the check at Bank B. · On December 30, 2022, a check from Bank A was written to the SP for $1,400. The check was signed by the SP. The SP cashed/deposited the check at Bank B the same day. · On December 31, 2022, a check from Bank A was written to the SP’s significant other for $500. The check was signed by the SP. On January 2, 2023, the significant other cashed/deposited the check at Bank B. · On January 3, 2023, a check from Bank A was written to the SP for $3,600. The check was signed by the SP. On January 4, 2023, the SP cashed/deposited the check at Bank B. o Between December 17, 2022, and January 3, 2023, the above four checks from Bank A totaled $7,300, and those checks were deposited into Bank B. · On January 3, 2022, a check from Bank B was written by the SP to him/herself for $7,300. The check was signed by the SP. The check appeared to have had the incorrectly dated year, however on January 4, 2023, the check was deposited into Bank A. · On January 10, 2023, a check from Bank A was written to the SP’s family member for $60. The check was signed by the SP. The family member cashed/deposited the check at Bank B the same day. · On January 11, 2023, a check from Bank A was written to the SP’s significant other for $1,500. The check was signed by the SP. On January 12, 2023, the significant other cashed/deposited the check at Bank B. · On January 13, 2023, a check from Bank A was written to the SP for $3,100. The check was signed by the SP. The SP cashed/deposited the check at Bank B the same day. The net deposit was $1,200 into Bank B. The was no information within the documentation which showed what occurred with the other $1,900. · On January 13, 2023, a check from Bank A was written to the SP’s significant other for $1,000. The check was signed by the SP. On January 17, 2023, the significant other cashed/deposited the check at Bank B. · On January 17, 2023, a check from Bank B was written by the SP to him/herself for $4,800. The check was signed by the SP. · A bank statement from Bank A dated November 17, to December 17, 2022, showed funds in the account were below $0. There was a check that was written by the SP was returned due to non-sufficient funds (NSF). · A bank statement from Bank A dated December 17, 2022, to January 17, 2023, showed multiple incidents in which the funds in the account were below $0, and multiple overdraft fees, which totaled $75. The overdraft fees occurred due to checks that were written/signed by the SP. Also, multiple checks that were written by the SP were returned due to non-sufficient funds (NSF). The VA provided the following information: · The VA worked and money was deposited into his/her account. The SP assisted the VA with his/her finances, and the VA either used cash to purchase items or the SP would purchase the items the VA needed. The VA did not track the amount of money in his/her account, and was not aware if anyone else tracked the bank account. The VA was not aware of any money being stolen or used without his/her consent. · The VA was aware of large checks in excess of $4,000 being written from his/her bank account, but was unable to provide any details related to the money. · The VA said s/he went to a casino “three or four” times and played slot machines. The VA said “we usually take twenty out” of the account while s/he was at the casino, but was not aware of the multiple withdrawals as stated above. · The VA said s/he got a new bank account after the bank closed. · The VA did not have any concerns about living at the facility. LE completed an interview with the SP and the following information was included: · The SP admitted to knowing that it was illegal to write checks from an account with insufficient funds. The SP denied trying to “inflate” bank accounts, but later said s/he moved money from different accounts to avoid over drafting accounts. The SP said s/he did not mean to do anything wrong. LE informed the SP that s/he had described “check kiting,” and the SP said s/he did not know that was illegal. · There were multiple occasions the same dollar amount or similar dollar amounts were withdrawn and deposited into accounts on the same day or around the same timeframe. · The SP admitted to withdrawing money from Bank A and depositing it into Bank B and was unable to provide any explanation beyond that everything got “so messed up.” The SP said s/he was “probably trying to cover up a deficit in [his/her] account.” The SP said the aforementioned checks were written by him/her from Bank A to him/herself, his/her significant other, and/or family members. The SP said the checks were written from one account and deposited into another were to avoid negative balances. The SP’s wrote checks to his/her significant other from Bank A, but the significant other did not ask any questions as the SP was in charge of the finances. · The SP admitted s/he had “screwed up” the VA’s bank account. The SP said s/he had an issue with a new medication s/he started taking in July 2022, and the medication made him/her “impulsive.” The SP started purchasing items in August 2022, and tried to do things to “cover it,” but it was a “mess.” The SP said the situation had nothing to do with the VA and it was the SP’s money. · The SP also stated s/he started “gambling” a lot, and acknowledged most of the money was spent at a casino. The SP said the VA would also go to the casino. · LE reviewed the bank records and determined criminal charges will not be pursued at this time. LE believed finances were not stolen, and the SP closed accounts associated with the reported activity. · The SP said the VA’s account was closed and s/he would provide the VA money if s/he needed anything. The SP was interview by this investigator and the following information was provided:
· The SP said all of the money in Bank A was the VA’s. The SP did not track the money that was withdrawn from the account and provided to the VA. The SP was unable to provide any documentation that showed the VA’s finances in Bank A were not affected by the moving/transferring of money to Bank B. The SP said s/he messed up, but “tried to fix” everything and described using multiple checking accounts as described above to move around money. · The SP said s/he provided the VA with the money from his/her paycheck, but would put money into the bank that was open which included accounts at both Bank A and Bank B. The SP would also use an ATM to withdrawal money from Bank A and provide the money to the VA. The SP said the VA had a debit card, and the VA used the debit card at the casino approximately six times while they were at the casino. The SP denied using the VA’s money while at the casino. · The VA did not have the “skill” to track his/her banking account, and the SP said no one tried to assist the VA with his/her bank account. The VA’s account was closed, and now the VA had a new personal account. The SP would assist the VA with tracking his/her finances. Facility documentation showed that the SP received training on the Reporting of Maltreatment of Vulnerable Adults Act. Relevant Rule and/or Statute: Minnesota Statutes, section 245A.04, subdivision 13, paragraph (b), stated that the license holder must ensure separation of funds of persons served by the program from funds of the license holder, the program or program staff persons. Minnesota Statutes, section 245A.04, subdivision 13, paragraph (c), clause (1), stated that whenever the license holder assists a person served by the program with the safekeeping of funds, the license holder must immediately document receipt and disbursement of the person’s funds at the time of receipt or disbursement. Conclusion: A. Maltreatment: According to the VA’s client specific documentation, the VA had limited reading, number, and money skills. The VA would not recognize mismanagement of his/her finances, and would not report mismanagement of funds. The SP would assist the VA with all financial matters. At Bank A, the SP and the VA co-owned a bank account. At Bank B, the SP, the SP’s family member, and the SP’s significant other each had bank accounts; none of which the VA was an owner of. The VA said the SP assisted him/her with all finances, including purchasing items for the VA or providing the VA with cash. The VA said s/he was aware of large dollar amount checks that were in his/her account, but was unable to provide any details related to the money. The VA said s/he would go to the casino and $20 would be withdrawn from his/her account, but was not aware of the multiple larger dollar amount withdrawals that were within his/her bank statement. The VA’s paycheck from work was consistently deposited into Bank A which was co-owned by the VA and the SP. LE and this investigator completed an interview with the SP, and reviewed documentation from Bank A and Bank B. The SP admitted to using Bank A’s account to supplement Bank B’s account due to concerns of insufficient funds, furthermore, the SP said Bank A’s account would have insufficient funds due to the checks and overdraft fees were charged. This was confirmed based on the bank statement from accounts at Bank A and Bank B. Additionally, there was numerous ATM withdrawals at a casino from Bank A. The VA said s/he was provided $20 from the SP while at the casino, however there were numerous withdrawals of hundreds of dollars at the casino. The withdrawals dated back to June 2020 and totaled approximately $10,000. The SP engaged in check-kiting (as described above), and/or writing checks with insufficient checks from Bank A, in order to cover the balance within Bank B. LE informed the SP that s/he had described “check kiting,” and the SP acknowledged knowing that writing not sufficient funds (NSF) checks was illegal. The SP wrote multiple checks from Bank A, where the VA’s paychecks were deposited, to him/herself, his/her significant other, and a family member. In addition, the SP used his/her personal banking account at Bank B to deposit the VA’s work check and county income on multiple occasions with no documentation that the SP provided the money to the VA. These were violations of Minnesota Statutes, section 245A.04, subdivision 13, paragraph (b) and paragraph (c), clause (1), Given that the account at Bank A was the VA’s account in which the VA’s paycheck was deposited, that the SP wrote several checks from that account to his/herself, his/her significant other, and his/her family member that were deposited or cashed at Bank B where the VA did not have a bank account, and that the VA was charged overdraft fees on his/her account at Bank A when the SP wrote these checks not for the VA from the VA’s account, there was a preponderance of the evidence that the SP willfully used and withheld the VA’s funds in the absence of legal authority. It was determined that financial exploitation occurred (in the absence of legal authority a person willfully uses, withholds, or disposes of funds or property of a vulnerable adult) B. Responsibility pursuant to Minnesota Statutes, section 626.557, subdivision 9c, paragraph (c): When determining whether the facility or individual is the responsible party for substantiated maltreatment or whether both the facility and the individual are responsible for substantiated maltreatment, the lead agency shall consider at least the following mitigating factors: (1) whether the actions of the facility or the individual caregivers were in accordance with, and followed the terms of, an erroneous physician order, prescription, resident care plan, or directive. This is not a mitigating factor when the facility or caregiver is responsible for the issuance of the erroneous order, prescription, plan, or directive or knows or should have known of the errors and took no reasonable measures to correct the defect before administering care; (2) the comparative responsibility between the facility, other caregivers, and requirements placed upon the employee, including but not limited to, the facility’s compliance with related regulatory standards and factors such as the adequacy of facility policies and procedures, the adequacy of facility training, the adequacy of an individual’s participation in the training, the adequacy of caregiver supervision, the adequacy of facility staffing levels, and a consideration of the scope of the individual employee’s authority; and (3) whether the facility or individual followed professional standards in exercising professional judgment. The SP was trained on the Reporting of Maltreatment of Vulnerable Adults Act and the SP was responsible for maintaining and tracking the VA’s funds. The SP was responsible for the maltreatment of the VA. When substantiated maltreatment is determined to have been committed by an individual who is also the facility license holder, both the individual and the facility must be determined responsible for the maltreatment, and both the background study disqualification standards under section 245C.15, subdivision 4, and the licensing actions under sections 245A.06 or 245A.07 apply. The SP was a facility license holder, therefore the facility is also responsible for the maltreatment of the VA. C. Recurring and/or Serious Maltreatment: The Office of Inspector General is required to evaluate whether substantiated maltreatment by a facility meets the statutory criteria to be determined as “serious.” The Office of Inspector General is required to evaluate whether substantiated maltreatment by an individual meets the statutory criteria to be determined as “recurring or serious,” and whether any substantiated maltreatment by a facility meets the statutory criteria to be determined as “serious.” Individuals determined to be responsible for recurring or serious maltreatment are disqualified from providing direct contact services. Minnesota Statutes, section 245C.02, subdivision 16, states: “Recurring maltreatment” means more than one incident of maltreatment for which there is a preponderance of evidence that maltreatment occurred and that the subject was responsible for the maltreatment. Minnesota Statutes, section 245C.02, subdivision 18, states: "Serious maltreatment" means sexual abuse, maltreatment resulting in death, neglect resulting in serious injury which reasonably requires the care of a physician whether or not the care of a physician was sought, or abuse resulting in serious injury. For purposes of this definition, "care of a physician" is treatment received or ordered by a physician, physician assistant, or nurse practitioner, but does not include diagnostic testing, assessment, or observation; the application of, recommendation to use, or prescription solely for a remedy that is available over the counter without a prescription; or a prescription solely for a topical antibiotic to treat burns when there is no follow-up appointment. For purposes of this definition, "abuse resulting in serious injury" means: bruises, bites, skin laceration, or tissue damage; fractures; dislocations; evidence of internal injuries; head injuries with loss of consciousness; extensive second-degree or third-degree burns and other burns for which complications are present; extensive second-degree or third-degree frostbite and other frostbite for which complications are present; irreversible mobility or avulsion of teeth; injuries to the eyes; ingestion of foreign substances and objects that are harmful; near drowning; and heat exhaustion or sunstroke. Serious maltreatment includes neglect when it results in criminal sexual conduct against a child or vulnerable adult. It was determined that the substantiated maltreatment for which the SP and the facility were responsible did not meet statutory criteria to be determined serious maltreatment. However, it was determined that the substantiated maltreatment for which the SP was responsible for was recurring because there was more than one incident. Action Taken by Facility: The facility completed an internal review and determined their policies and procedures were followed and adequate. There was no additional staff training or corrective action taken by the facility. There were no similar incidents in the past. Action Taken by Department of Human Services, Office of Inspector General: The SP was disqualified from a position allowing direct contact with, or access to, persons receiving services from programs, organizations, and/or agencies that are required to have individuals complete a background study by the Department of Human Services as listed in Minnesota Statutes, section 245C.03. The determination that the SP was responsible for maltreatment and the disqualification of the SP are each subject to appeal. Additionally, based on determinations of substantiated maltreatment and the disqualification of a controlling individual the facility’s licenses were revoked. The maltreatment determination, the SP’s disqualification, and the revocation are each subject to appeal.
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