Audit Alleges Middleton Foster Care Company Embezzled Millions in Taxpayer Money

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MTT News Desk's picture
By: 
Matt Geiger

What began as a routine review of a Middleton foster care agency revealed that the owners were using taxpayers’ money to dine on lobster tails, pay themselves at more than three times the customary rate and purchase luxury cars.

In all, the Wisconsin Department of Children and Families alleges Community Care Resources, Inc. wasted more than $6.1 million of public funding.

A statement issued by the Department of Children and Families confirmed that on January 23, the department revoked the license of Community Care Resources, effective February 7, after determining the organization had “substantial violations of state licensing regulations.”

The wages director Dan Simon paid to himself during the three-year period of review totaled more than $1 million. A review of the top eight average provider salaries showed an average salary of $102,770 and a review of salary.com showed the top behavioral executive in Middleton earning $139,111.

“Based on these results a more equitable salary would be $150,000 per year for a total of $450,000 for the three year period under review,” stated the report.

Mary Simon received wages that totaled $382,047 during the three-year review period. Her job title is program director for the agency. Based upon a review of the average salaries of the six highest paying providers resulted in an average salary of $64,667.

A more reasonable salary for Mary Simon based on this information would be $80,000 per year for a total salary of $240,000 for the three years under review, according to the department.

Sara Buschman, Communications Director for the Department of Children and Families, said the violations are not related to the quality of care provided by foster parents. She added that foster children linked to Community Care Resources are all safe. 

Community Care Resources, which is located at 6716 Stone Glen Drive, rejected the findings and appealed the Department’s decision to the Department of Administration’s Division of Hearings and Appeals. 

Attorney David Schwartz, who has been retained by the Simons, said they have begun an investigation into the matter. “We look forward to the opportunity to assert our position,” Schwartz stated.

Dan Simon declined to comment.

“It greatly distresses me when funds for the care of vulnerable children are alleged to be used for personal gain,” said Eloise Anderson, secretary of the Department of Children and Families. “As a steward of taxpayer dollars, the department aggressively investigates and pursues those who are alleged to have misused public funds.”

According to the Department of Children and Families, in 2011 the department implemented stronger auditing tools based on new legislative authority. It was these tools, used in the audit that revealed alleged waste at the Middleton business.

On January 23, 2013, the department issued a letter to Dan Simon asking him to return “all money paid in excess of the conditions of the contracts entered into with the various counties with which CCR did business.” The letter ordered Mr. Simon to remit $6,149,118 to the Department of Children and Families no later than February 22 of this year.  

Under Wisconsin Statute 48.72, the business had the right to a hearing within 30 days of the hearing request unless they waive that right. On February 4, Community Care Resources waived the 30-day limit, allowing for an undefined time period in which the appeals will be heard. 

During this time, foster parents licensed by Community Care Resources will receive payments directly from their county.

Buschman said the Department of Children and Families The Department has been systematically auditing child welfare agencies and will continue this process on a routine basis. 

“Reviews of other child placement agencies are still in progress and final reports will be forthcoming,” she said.

 

 

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