Hospital kickback allegations refuted
A company accused in a kickback scheme involving The Ottawa Hospital acknowledges it hosted the manager of capital projects “in the ordinary course of business” and hired his daughter, but denies any involvement in an alleged scheme to defraud the hospital.
Federal Electric (1976) Limited, owned by Larry St. Pierre, and Pro Management Construction Inc., owned by Roch St.-Louis, denied any wrongdoing in statements of defence filed in court this week.
In a court document filed in January, the hospital alleged a massive fraud and kickback scheme involving two of its senior managers and a number of contractors.
Federal Electric and Pro Management are the latest contractors to deny the allegations, which have not been proven in court.
Among the allegations are contractors received favourable access to hospital construction jobs and inflated payments in exchange for expensive trips, work on houses and cottages and other kickbacks for the hospital managers.
Federal Electric said in its statement of defence it would have hosted Frank Medwenitsch, the hospital’s former director of capital projects, “as part of business development activities customary in the industry, but denies that there was anything wrong or illicit.” It added any responsibility to report hospitality is between Medwenitsch and the hospital, which limits gifts to $25.
Medwenitsch stated in an earlier court document he took a fishing trip with some hospital contractors, including Federal Electric, but says he paid for it. The hospital says documents Medwenitsch provided them with to prove he paid for the luxury trip to a British Columbia fishing lodge only further support allegations of fraud against him.
Federal Electric, in its statement of defence, acknowledges it hired Medwenitsch’s daughter Katrina Haucke for one year as an accounting and administrative assistant. The company says it never received money from Medwenitsch or the hospital “directly or indirectly” to pay for her salary. “Federal Electric denies that it received any inflated hospital purchase order to partially or otherwise cover the costs of her employment. Ms. Haucke was a proper and bona fide employee who received appropriate compensation for services rendered.”
The hospital filed a section of a text message between Medwenitsch and St. Pierre, which it says supports its allegations his daughter’s employment was partly paid for by the hospital: “$1,280 of the $6,300 picks up Katrina — the remainder goes to the project,” said the message, which the hospital says was written by Medwenitsch.
In the documents filed this week, Federal Electric acknowledged it “did on occasion receive certain draft copies of procurement documents.” It denies the documents provided any procurement advantages.
The company denied any wrongdoing, adding any damages the hospital suffered were the result of its own negligence, conduct, acts or omissions.
Pro Management Construction Inc. also denies the hospital’s allegations and any wrongdoing.
Lawyers for Medwenitsch, Federal Electric and Pro Management were unavailable for comment when contacted by Postmedia.