Failure to Investigate Alleged Financial Misappropriation and Protect Resident Financial Information
Penalty
Summary
The facility failed to implement its policies prohibiting financial misappropriation for one resident when it did not investigate allegations of fraud involving the resident’s finances. The resident had a history of anxiety disorder, calculus of the ureter, mood affective disorder, and vascular dementia, and an MDS BIMS score of 11 indicating moderate cognitive impairment. The resident was initially not private pay but became private pay after insurance coverage ended, and the business office monitored her financial status because private pay residents were considered rare and the office’s role was to collect money and be aware of when residents might need financial assistance. On a date in April, the Business Manager documented a call from the resident’s private fiduciary, who reported filing a Victim of Fraud claim on behalf of the resident, stating that the resident’s account had been drained of $265,000 and that the police were investigating. The fiduciary requested facility participation in the investigation and copies of financial statements and documentation of the resident’s private pay status. The Business Manager documented that she informed the then-Executive Director/Administrator of the fiduciary’s allegations, including that the fiduciary was asking for facility staff to be investigated for fraud. The fiduciary later stated in interview that the facility had paid itself from the resident’s accounts before she became the financial power of attorney, that she had reported the suspected fraud to both the police and the facility while the resident was still there, and that the resident kept a nightstand drawer full of mail and financial documents, including statements and retirement fund information, which were left vulnerable to anyone entering the room. In subsequent interviews, the current Administrator reported that he and the previous Administrator had gone over the fiduciary’s allegations with her, but that, after speaking with the previous Administrator, it appeared that nothing had been done in response to the fraud allegations and that the previous Administrator had determined there was nothing to investigate. The facility’s abuse policy, revised in October, stated that residents have the right to be free from misappropriation of resident property and exploitation, that staff with knowledge of an actual or potential violation must immediately report it to a supervisor or the Administrator, and that all allegations of abuse, neglect, misappropriation, or exploitation would be promptly and thoroughly investigated with interviews, record review, and documentation of the investigation and its results. Despite this policy, the allegation of financial misappropriation involving this resident was not investigated at the time it was reported.
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