Veterans hospital supervisor charged in alleged $1.7M kickback scheme

A supervisor at a West Side veterans hospital has been charged in U.S. District Court in an alleged $1.7 million kickback scheme to steer supply purchases to a south suburban company.

Thomas E. Duncan, 37, of Chicago, who was the central supplies manager for the Jesse Brown VA Medical Center, was charged in a seven-count indictment with wire fraud and obstructing an inspector general’s investigation, court records show.

Also charged with a single wire fraud count was Daniel Dingle, 50, of Riverdale, the owner of a Dolton-based supply company who allegedly paid at least $36,000 over a seven-year period to a company Duncan owned in order to secure orders with the Jesse Brown center.

An arraignment date had not been set as of Friday, and lawyers for the defendants were not listed in the court docket.

According to the 12-page indictment returned Thursday, Duncan supervised purchases for the medical center, which operates a 220-bed facility in the 800 block of South Damen Avenue in Chicago and four community-based outpatient clinics serving the sixcounty metro area.

Beginning in 2012, Duncan agreed to place orders for products from Dingle’s company in exchange for cash and checks made out to Helping Hands, a private company that Duncan controlled, the indictment alleged. To hide the fraud, Duncan kept the purchases in amounts below the threshold that would have triggered additional oversight, and instructed underlings to mark deliveries from Dingle’s company as

“completed” even though many of the products were never actually delivered, the indictment alleged.

Dingle also wrote “false and misleading” statements in the memo section of the checks he gave to Helping Hands to disguise the money’s true purpose, according to the charges.

When the inspector general’s office for the U.S. Department of Veterans Affairs asked questions about the payments, Duncan instructed Dingle to lie and say the money was for work provided by Helping Hands, the indictment alleged.

In all, Dingle’s company fraudulently received $1.7 million in orders from the Veterans Affairs Department over the length of the scheme, the charges alleged.

Calls seeking comment from the Jesse Brown VA Medical Center were not immediately returned Friday.