Former CEO of Florida Group Home Association Convicted of Conspiracy to Defraud SSA

From the U.S. Attorney's Office, Middle District of Florida:

 

Tampa, FL – Acting United States Attorney W. Stephen Muldrow announces that a federal jury today found Richard Lilliston (70, Brooksville) guilty of conspiracy to defraud the United States, and to make false statements to the Social Security Administration. He faces a maximum penalty of five years in federal prison and a fine of $250,000. A sentencing date has not yet been set.

 

According to court documents, the Hillsborough Achievement and Resource Centers (HARC), formerly the Hillsborough Association for Retarded Citizens, was established in 1953 to positively impact the future for all people living with developmental disabilities, such as Alzheimer’s disease and Down syndrome. HARC opened and operated group homes that served its target client population. HARC also spearheaded various community programs for its clients focused on inclusion activities for youths, adults, and seniors with disabilities.

 

Many of the HARC clients received SSA benefits due to various developmental disabilities. For certain HARC clients who lacked the capacity to manage their own SSA benefits, SSA approved one or more HARC officials to act as a “Representative Payee” to receive the client’s benefits and to use them exclusively for that client’s benefit. As a Representative Payee, the HARC official was required to complete and submit to the SSA a “Representative Payee Report” that included information about each HARC client’s living situation and the financial benefits received and expended on behalf of that client.

 

Lilliston began working at HARC in 1997 as the Chief Executive Officer. While working in that capacity, he and others orchestrated a scheme whereby HARC client funds, purportedly saved solely for HARC’s developmentally disabled clients’ needs and use in a HARC bank account (“Endowment Account),” had been and were being wrongfully diverted from the clients to the HARC operating account for other purposes.

 

In November 2009, in an effort to conceal that HARC client funds were being wrongfully diverted from the clients and to make it appear as if HARC’s Endowment Account had been properly established and maintained, Lilliston directed the former HARC CFO and Controller to secure signatures from the developmentally disabled HARC clients on a document backdated to 2007, titled “Pooled Trust Joinder Agreement.” The CFO and Controller did as instructed, knowing that the HARC clients who signed the Pooled Trust Joinder Agreement document did not have the capacity necessary to understand the importance of the document. Notwithstanding, Lilliston and other HARC employees signed the backdated agreements. Trial testimony further revealed that Lilliston was terminated from his HARC CEO position in November 2011, following a discovery by the HARC Board of Directors that he had wrongfully taken an additional $10,000 in salary ($160,000 rather than the approved $150,000) and had allotted himself a car allowance of $1,850 per month.

 

In June 2013, the U.S. Attorney’s Office filed a Verified Complaint for Forfeiture Rem in a related case (Case No. 8:13-cv-1601-T-17TBM), seeking the forfeiture of $87,000 held in a Synovus Bank account. That complaint raised like allegations that HARC clients’ SSA benefits had been wrongfully diverted from the clients and used by HARC for other purposes and was supported by facts contained in the sworn affidavit of a special agent with the U.S. Department of Health and Human Services - Office of spector General. On September 30, 2013, the district court entered a Default Judgment of Forfeiture in which the court ordered the forfeiture of the $87,000 to the United States.

 

This case was investigated by the Social Security Administration - Office of the Inspector General, the U.S. Department of Health and Human Services - Office of Inspector General, and the Florida Department of Law Enforcement, along with the State of Florida’s Department of Financial Services - Office of Fiscal Integrity. It is being prosecuted by Assistant United States Attorney Jay G. Trezevant.

 <p style="margin: 0in 0in 0pt"> From the U.S. Attorney’s Office, Middle District of Florida: </p>

 

Tampa, FL – Acting United States Attorney W. Stephen Muldrow announces that a federal jury today found Richard Lilliston (70, Brooksville) guilty of conspiracy to defraud the United States, and to make false statements to the Social Security Administration. He faces a maximum penalty of five years in federal prison and a fine of $250,000. A sentencing date has not yet been set.

 

According to court documents, the Hillsborough Achievement and Resource Centers (HARC), formerly the Hillsborough Association for Retarded Citizens, was established in 1953 to positively impact the future for all people living with developmental disabilities, such as Alzheimer’s disease and Down syndrome. HARC opened and operated group homes that served its target client population. HARC also spearheaded various community programs for its clients focused on inclusion activities for youths, adults, and seniors with disabilities.

 

Many of the HARC clients received SSA benefits due to various developmental disabilities. For certain HARC clients who lacked the capacity to manage their own SSA benefits, SSA approved one or more HARC officials to act as a “Representative Payee” to receive the client’s benefits and to use them exclusively for that client’s benefit. As a Representative Payee, the HARC official was required to complete and submit to the SSA a “Representative Payee Report” that included information about each HARC client’s living situation and the financial benefits received and expended on behalf of that client.

 

Lilliston began working at HARC in 1997 as the Chief Executive Officer. While working in that capacity, he and others orchestrated a scheme whereby HARC client funds, purportedly saved solely for HARC’s developmentally disabled clients’ needs and use in a HARC bank account (“Endowment Account),” had been and were being wrongfully diverted from the clients to the HARC operating account for other purposes.

 

In November 2009, in an effort to conceal that HARC client funds were being wrongfully diverted from the clients and to make it appear as if HARC’s Endowment Account had been properly established and maintained, Lilliston directed the former HARC CFO and Controller to secure signatures from the developmentally disabled HARC clients on a document backdated to 2007, titled “Pooled Trust Joinder Agreement.” The CFO and Controller did as instructed, knowing that the HARC clients who signed the Pooled Trust Joinder Agreement document did not have the capacity necessary to understand the importance of the document. Notwithstanding, Lilliston and other HARC employees signed the backdated agreements. Trial testimony further revealed that Lilliston was terminated from his HARC CEO position in November 2011, following a discovery by the HARC Board of Directors that he had wrongfully taken an additional $10,000 in salary ($160,000 rather than the approved $150,000) and had allotted himself a car allowance of $1,850 per month.

 

In June 2013, the U.S. Attorney’s Office filed a Verified Complaint for Forfeiture Rem in a related case (Case No. 8:13-cv-1601-T-17TBM), seeking the forfeiture of $87,000 held in a Synovus Bank account. That complaint raised like allegations that HARC clients’ SSA benefits had been wrongfully diverted from the clients and used by HARC for other purposes and was supported by facts contained in the sworn affidavit of a special agent with the U.S. Department of Health and Human Services - Office of spector General. On September 30, 2013, the district court entered a Default Judgment of Forfeiture in which the court ordered the forfeiture of the $87,000 to the United States.

 

This case was investigated by the Social Security Administration - Office of the Inspector General, the U.S. Department of Health and Human Services - Office of Inspector General, and the Florida Department of Law Enforcement, along with the State of Florida’s Department of Financial Services - Office of Fiscal Integrity. It is being prosecuted by Assistant United States Attorney Jay G. Trezevant.