The arrest of the former owner of an Arkansas nursing home was recently announced by Arkansas’ attorney general. The man is accused of emptying or severely depleting residents’ trust fund accounts of more than $43,000. He has been charged with one count of theft of property valued at more than $25,000.
An investigation was begun on September 27, 2019, after the Arkansas Department of Human Services discovered that the accused man had stolen most or all of the funds in residents’ trust fund accounts at several facilities that the former owner managed. The local police department participated in the investigation along with agents from the state attorney general’s office and federal agents with the Offices of Investigation for the Social Security Administration and Health and Human Services.
Compliance Perspective
Failure to ensure that there is an accounting system in place to prevent the embezzlement of funds deposited in residents’ trust fund accounts by any persons with access to those funds and whose responsibility it is to protect and manage those funds may be considered to be a violation of residents rights to be free from misappropriation and exploitation and deemed provision of substandard quality of care in violation of state and federal regulations
Discussion Points:
- Review policies and procedures regarding oversight of residents’ trust fund accounts and the implementation of Generally Accepted Accounting Principles (GAAP) that provide for a separation of duties for receipt and disbursement of those funds and periodic reporting to the residents.
- Train employees with responsibilities that involve residents’ trust fund accounts to ensure that a separation of duties is in place and followed regarding receipts and disbursements. Also, train staff members who may become aware or suspect that funds are being misappropriated to report those concerns to their supervisor of through the facility’s Hotline.
- Periodically audit to ensure that residents’ trust fund accounts/personal fund accounts are properly managed.
