Calling the actions of their former administrator an “outrageous betrayal of trust,” authorities with the Miami Beach Community Health Center are investigating what they call the theft of almost $7 million in taxpayer money by the center’s longtime chief executive.
Members of the health center’s board of directors fired Chief Executive Officer Kathryn Abbate, saying she diverted the nearly $7 million in money intended to provide healthcare for the needy to her personal use beginning in 2008.Abbate’s chief compliance officer, Diego Martinez, resigned when the board determined he cashed thousands of dollars in checks for Abbate.
Chief Financial Officer Stanley DeHart was fired and the clinic’s human resources director, Angie Aguila, resigned after board members concluded the two had “facilitated” Abbate’s embezzlement.
Board members discovered the enormous loss in May, after a routine audit required by federal funders turned up irregularities, said Mark Rabinowitz, an obstetrician and gynecologist who is the center’s chief medical officer. Abbate had written a check for $5,000 to herself, and cashed it, labeling the expenditure a “community development” expense, said Rabinowitz, who has been tapped by the board to reorganize the clinic in the scandal’s wake.
When asked by Rabinowitz to explain the check, Abbate had no answer, the doctor said, and the agency retained forensic auditors and healthcare lawyers to disentangle Abbate’s dealings.
“Everybody here believed she was a real do-gooder, me included,” said Rabinowitz. “This has been very hard to deal with.”
The center immediately began a more detailed audit, and alerted the U.S. Department of Health & Human Services, which provides close to $4 million in grants to the center every year. Later, the FBI contacted the center. Citing U.S. Justice Department policy, Alicia Valle, a spokeswoman for U.S. Attorney Wifredo Ferrer, declined to comment.
The health center also contacted The Miami Herald, disclosing the details of Abbate’s alleged scheme. Rabinowitz said administrators and board members wanted employees, patients and community supporters to know the health center was doing all it could to hold Abbate accountable, and to make the necessary reforms to prevent other improprieties.
Abbate did not return calls from a Miami Herald reporter.
Carlos Fleites, a lawyer for Martinez, said Martinez had resigned from the health center before Abbate's alleged wrongdoing was discovered, and was not forced to resign by board members.
“He resigned of his own volition,” Fleites said. “He has not been charged, or even implicated, in this at all.”
DeHart, who lives in Coral Springs, said he was aware of many of Abbate’s activities, but declined to alert the board of directors. “The board of directors was very close to her, and I really thought they would not believe me,” DeHart said. “They held her in very high esteem.”
DeHart and members of his staff “discussed whistle-blowing,” he said, but they all agreed taking such an action was more likely to result in their firing than Abbate’s. “I felt at the time, and I still feel, that I had no proof that the board of directors would accept.”