Salary padding
State investigation led to charges that the Upstate Medical president padded his salary
Ex-upstate Medical University head pleads guilty to official misconduct.
The former president of Upstate Medical University in Syracuse pleaded guilty to three counts of official misconduct on Monday, admitting that he had secretly boosted his annual pay by more than $28,000 and used unauthorized expenses to increase his $5,000-a-month housing allowance.
David R. Smith, who was president of the embattled university from 2006 to 2013, agreed to pay $250,000 in restitution and fines as part of his plea to three misdemeanor charges in Syracuse City Court.
The investigation was conducted by the offices of the state attorney general and inspector general. In a statement, the agencies said that Smith’s compensation — more than $360,000 a year — had been set by the SUNY chancellor and board of trustees. But in 2007, Smith directed a subordinate to approve his receipt of an unauthorized raise through the SUNY Research Foundation worth $28,450 a year.
According to his guilty plea, Smith also admitted submitting expense receipts for reimbursements he was not entitled to receive in order to augment his monthly housing allowance. In addition, he illegally set up a deferred compensation plan for himself and others — not identified by authorities — from Medbest Medical Management, Inc., a company that provided billing services for Upstate Medical University’s hospital and its physicians.
“Once a top executive at a premier medical school and now a convicted criminal, this defendant shamelessly corrupted his position of trust and exploited the university’s lax oversight for an extraordinary theft,” Inspector General Catherine Leahy Scott said in a statement. “Dr. Smith improperly manipulated and siphoned from numerous funding streams under his control, and my investigation is continuing to help ensure such foul play can never happen again.”
Smith is scheduled to receive three years’ probation when he is sentenced in December, according to his plea agreement.
Smith’s attorney, William J. Dreyer of Albany, said the disposition of the case — misdemeanors and probation — “speaks for itself.”
The five-year investigation that ended with Smith’s unannounced plea came as the Onondaga County district attorney’s office recently confirmed it has launched an unrelated grand jury investigation of Upstate Medical University, including hiring decisions, severance packages and construction projects.
In May, a top official at the university, Sergio A. Garcia, resigned in the wake of a Times Union report revealing apparent fabrications in his professional biography.
The grand jury investigation is
also examining a severance package that was awarded to former SUNY Upstate Medical University Hospital CEO Dr. John Mccabe. The Syracuse Post-standard reported in June that Mccabe had been paid $660,500 for a 14-month “off-campus assignment.”
A source briefed on the grand jury investigation said the office of Onondaga District Attorney William J. Fitzpatrick is scrutinizing that deal, which was authorized by the university’s president, Danielle Laraque-arena, because it may have provided payment of public dollars without consideration of work. Also, Mccabe was being paid even though he allegedly had been banned from attending events at the campus.
Also Monday, Onondaga County Executive Joanie Mahoney announced that she will be resigning her elected post next month in order to take a leadership post at SUNY’S College of Environmental Science and Forestry, and will serve as a special advisor to Upstate Medical University. Mahoney, a Republican in her third term, has been an ally of Gov. Andrew M. Cuomo.