Hospital scam bigger than thought: Report
New mothers’ names sold by staffers, search warrant indicates
The alleged scheme to sell stolen maternity ward records to investment brokers so they could peddle RESPs to new mothers was much larger than previously believed, according to sworn police documents obtained by the Star.
After charging a former Rouge Valley Hospital clerk last November, this week the Ontario Securities Commission laid charges against another hospital employee and three financial salespeople.
But the 290-page document summarizing the police investigation filed at Old City Hall Courthouse reveals that police were aware of at least 15 other RESP sales representatives and two other hospital employees involved — though they haven’t been charged.
The document — called an Information to Obtain, or ITO, is used in requests for search warrants. All allegations within it are unproven.
The ITO summarizes an investigation that began in April 2014, when police were contacted by Rouge Valley Hospital after they discovered two privacy breaches.
Since then, police have sworn 11 ITOs in front of a justice of the peace and been granted 32 search warrants and one order to produce financial records.
The ITO describes what police believe were three parallel but overlapping arrangements between hospital employees and RESP salespeople that stretch back at least as far as 2009.
Police alleged that Nellie Acar, who worked for Global RESP Corporation, paid just under $4,500 for the names and contact information for families with newborn babies to Esther Cruz, a maternity ward nurse at both Rouge Valley and Scarborough Hospitals.
Police believed Acar also had a second hospital contact who had access to maternity records province-wide, and that she may have been passing along records to other RESP salespeople at her company and others, according to the ITO.
Contacted by the Star, Acar denied having paid for the names, claiming that Cruz gave them to her because she’s “a nice person.”
“I did not buy (them). It’s only a referral,” Acar said. “I did not kill people. I don’t steal money. I’m working.
“When you are in sales, you can find many people from outside. You can convince a lot of people and who knows where they get the names. So how would I know?” she said.
The ITO states police went undercover as a single mother and approached Acar for an RESP. Acar allegedly filled out the RESP application with inflated income and false employment information, leading to criminal charges of fraud.
Last year, Rouge Valley Hospital sent out more than 14,000 letters to mothers who had recently given birth, informing them of the privacy breach and many of them came forward to be interviewed by police. Victims identified at least seven other RESP salespeople who allegedly used the stolen records to cold call them and offer RESPs, including one other Global representative. Global told the Star that the named employee is no longer working with the company.
The second alleged scheme centred on Subramaniam Sulur, an assistant branch manager with C.S.T. Consultants Inc, who told police that he paid Rouge Valley Clerk Shaida Bandali for names of recent mothers, but only called one person from the list she provided, according to the ITO.
The Star was unable to reach Sulur for comment.
Financial records seized by police show Sulur paid Bandali almost $3,000. Investigators say they also found deposits into Sulur’s account from eight other C.S.T. employees.
“All amounts are divisible by $2.50 which suggests that Sulur may be selling baby names to other C.S.T. reps,” the ITO states.
The payments ranged from $125 to $550. In total, police believe that Sulur received $2,850 from his colleagues. C.S.T. said in a statement the eight colleagues named by police were witnesses who co-operated in the investigation and the company determined Sulur had been acting alone.
The third plot allegedly involved Poly Edry, a branch manager with Knowledge First Financial Inc, who told police she paid Bandali for records of recent births, but denied knowing that she worked at a hospital, according to the ITO. Through a bank account in her husband’s name, police alleged Edry transferred at least $3,950 to Bandali at a rate of $1per name.
Contacted by phone Tuesday, Edry hung up without comment. She did not return followup text messages.
Mothers whose patient information was stolen gave police the names of four other Knowledge First sales reps who contacted them. Knowledge First said the individuals named voluntarily participated in the investigation, and all remain in good standing with the company.