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March 28, 2012 9:57 am

BREAKING: Hospital says former CEO indicted on fraud charges

Written by CJ Baker

Powell Valley Healthcare's former CEO has been indicted by a federal grand jury in connection with an alleged scheme to embezzle money from the hospital, hospital officials announced this (Wednesday) morning.

A news release from Powell Valley Healthcare said Paul Cardwell has been indicted on 15 charges that include mail fraud, wire fraud and money laundering. Michael Plake, a West Lafayette, Ind., man that has been accused of working with Cardwell, has also been indicted on 15 counts, the release said.

"The allegations (against Plake and Cardwell) detail a fraudulent scheme, involving numerous acts of deception against PVHC employees and directors, whereby PVHC suffered significant financial losses," said the release.

Hospital officials said they and their management company, HealthTech Management Services Inc., have been working with federal investigators and appreciate their efforts to "see justice fully served."

The case against Cardwell had not been publicly unsealed as of this morning.

HealthTech had sued Cardwell in February, accusing him of embezzling nearly $850,000 from the Powell hospital. According to HealthTech's complaint, Cardwell had claimed he was paying an Indiana company to recruit doctors and staff to Powell Valley Healthcare. In reality, HealthTech alleged, the company was doing no recruiting and kicking a substantial amount of money back to Cardwell.

Powell Valley Healthcare officials have identified Plake as the owner of that company, called Plake and Associates.

The Tribune will have a more complete story in Thursday's newspaper.

2 comments

  • Comment Link March 28, 2012 11:03 am posted by clipstein

    well where was health tech, the board, the accountants???? as one person put it the trouble with the people of Powell is the people of Powell..... embrassing
    next question how much is the crew getting away with

  • Comment Link March 29, 2012 11:58 am posted by Greg

    How much of this did the rest of the Sr. Leadership team know or suspect and said nothing? Just asking.

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