East Lansing, MI – The criminal case against Summit Pointe CEO Erv Brinker rests on Bill Schuette- Attorney General for Michigan. He is accusing Brinkler of corrupt contracts involving a couple in Key West, Florida.
On July 22nd of this year, Brinker was arraigned on one count of embezzlement by a public official and two counts of Medicaid fraud conspiracy. Schuette gave a press release after the arraignment.
In it, he stated that his Health Care Fraud Division investigation found that Brinker stole money from the company. They accuse him of sending $510,000 to a Florida psychic and her husband under the guise of health care consulting.
“As CEO, Brinker had the authority to contractually bind Summit Pointe without Board approval and he allegedly signed the fraudulent contracts without the consultation of other employees. Additionally, Brinker did not notify the Board of Directors of the alleged contracts,” reads the press release.
Brinker stood calmly before Ingham County District Judge Richard Ball as his attorneys waived a preliminary examination of the charges. Judge Ball proceeded to charge him with the crime officially.
His case was sent to Ingham County Circuit Court for trial, and there’s a pre-trial hearing set for August 12th. There is a maximum penalty of 10 years in jail and a $5,000 fine for each charge upon conviction.
Matthew Vicari, one of Brinker’s attorneys, says they have been cooperating with the attorney general’s office for several months now.
Jeffrey Schroder is an Assistant Attorney General. He explained to the judge that they were getting close to a plea-bargain agreement with Brinker and his defense team.
Brinker Is Allowed To Post Bail
The judge released Brinker on a personal recognizance bond of $25,000 under two conditions. These conditions were set by Schroder and everyone agreed to them.
First, Brinker could not have any contact with Summit Pointe or any of its employees. Secondly, Brinker must have no contact with palm readers, fortunetellers, or psychics.
A list of Summit Pointe contractors included a Key West man by the name of Tommy Eli. Management mentioned this name at the meeting where they fired Brinker on February 17th.
Brinker, via his lawyer, repeatedly refused to answer questions about Eli at the public hearing. He declined to speak unless they guaranteed they wouldn’t use any information given to prosecute him in the future criminally.
The lawyers for Summit Pointe accused Brinker of making fake contract services. They said they couldn’t find any professional credentials for Eli and that the only ‘proof-of-work’ document found was one-page long.
However, they could see that Summit Pointe sent payments to Eli totaling about $510,000. He billed the agency for about 1,100 hours of service supposedly provided from October 2012 to April 2013. On some of these invoices, Eli claimed he conducted the services in person at the Summit Pointe office.
The last payment of $265,000 was paid to Eli by overnight courier. What’s more, it was marked “to the attention of” Julie Davis at an address in Key West, which raised suspicions.
The Receiver Of This Money Was A Psychic
This address turned out to be the address of a psychic business. According to a business license filed with the city of Key West, Davis is a “psychic and tarot card reader.”
During his press release, Schuette made the following statement: “Ensuring integrity in our health care system is critical to the safety of all Michigan citizens. Anyone attempting to skirt the law at the expense of patients and taxpayers will be identified and brought to justice.
I would like to thank Summit Pointe for bringing this case to our attention and providing assistance and full cooperation to ensure this never happens again.”
Following the arraignment, Summit Pointe sent a press release to several media outlets. It stated that Summit Pointe leaders and attorneys had worked with the Attorney General’s Office for months before arraignment.
Trae Allman is the Summit Pointe board president. His statement was, “When our board was informed of employee concerns about irregularities in contracting and expenditures, we engaged Fraser Trebilcock as independent counsel to conduct a careful, external investigation.
What we found through that process increasingly disappointed and alarmed us as a board, and among a series of other necessary actions, we contacted the appropriate authorities.
We are appreciative of the efforts of the Attorney General, and the Department of Health and Human Services, and we are relieved that this difficult chapter is finally over” in the press release.
Summit Pointe Lists Brinker’s Various Wrongdoings
The Summit Pointe board decided to fire Brinker and accused him of fabricating a defined-benefits pension plan for his personal benefit without seeking the board’s approval. In addition, they accused him of having “apparent and actual conflicts of interest” with some agency vendors.
They stated that he automatically gave contracts worth millions of dollars to vendors he had personal business ties with instead of competitively shopping them with other vendors.
The company fired Brinker after a three-month-long internal investigation into the agency by the law firm that Summit Pointe hired for this- Fraser Trebilcock Davis and Dunlap from Lansing, Michigan.
Two other executives for Summit Pointe, Bob Lambert, the Chief Operating Officer, and Leon Karnovsky, the Chief Financial Officer, resigned from the company during the investigation.
Following Brinker’s termination, the agency replaced all empty positions and made more money. They decided to cut off contracts with several vendors named in the resolution to fire Brinker. Finally, they have also made changes to their community partnerships.
In June, the annual Summit Pointe audit presented to the board uncovered financial reporting weaknesses. The auditors wouldn’t issue one because they couldn’t “obtain sufficient appropriate audit evidence when asked for an opinion.” The ongoing investigation also limited what they could say.
Read an update to this story here.