Director of Yonkers nonprofit charged in fraud scheme

The executive director of Yonkers-based nonprofit Systems and Abilities Inc. was accused by the state attorney general”™s office of rigging bids, demanding kickbacks and defrauding Medicaid of more than $50,000.

Darlington Odidika, 47, of Poughkeepsie, was released on $25,000 bail Wednesday after appearing in Yonkers City Court. The arrest comes nearly four years after a state commission detailed Odidika”™s scheme to defraud the Medicaid program at the nonprofit.

In that 42-page report, the state Commission on Quality of Care and Advocacy for Persons with Disabilities found that Odidika had submitted inflated costs for reimbursement, manipulated the bidding process through collusion and falsified documents to receive higher reimbursements from Medicaid.

The nonprofit was an enrolled provider in the Nursing Home Transition and Diversion Program, specializing in obtaining state-funded service contracts that provide construction and moving services to the elderly and disabled Medicaid recipients to allow them to move from nursing homes back into the community.

As part of the program, “the nonprofit often arranged for contractors to provide modifications to the homes of qualified Medicaid recipients through a required bid process and then billed Medicaid for the cost of the project, plus an administrative fee, based upon the final costs of the projects,” according to a statement by the attorney general”™s office. Between Aug. 31, 2009, and Nov. 30, 2011, Odidika “frequently falsified bids for NHTD program projects and submitted them to agents of the Department of Health. By falsifying these bids, Odidika was able to control which contractor won the bid. He then used the falsified bid to inflate the amount Medicaid paid Systems and Abilities as its share of the project,” according to the office.

The 2011 investigation by the state commission came in response to anonymous allegations that the nonprofit misused Medicaid funds and that its services were provided by “unqualified staff.”

The commission also took the board of directors to task for failing to set a reasonable salary for Odidika by “approving an employment contract with no upper limit on compensation and without regard to reviewing data on salaries and benefits paid to executives of comparable agencies.”

In addition, the commission found that the board let Odidika be paid part of his salary as an independent contractor, which allowed required withholdings for social security taxes and disability insurance to be avoided.

In its report, the commission made a number of recommendations underscored by the one that said the Health Department “should immediately terminate its contract(s) with Systems and begin to transition consumers to other providers.”

In a written response to the report, the Health Department in regard to the termination of the contract said, “DOH has placed Systems and Abilities on Vendor Hold effective May 13, 2011. Further action will be taken if warranted.”

In June 2011, the commission and the state Office for People with Developmental Disabilities met with the nonprofit”™s board to go over the findings in the report. The board in turn suspended Odidika until it completed its own investigation. It did not remove him from his position.

In the report, the commission stated the board”™s “lack of assertiveness raises the question as to what measures the state can take when a board of directors fails to act in the best interest of the corporation and its clients.”

In announcing the arrest of Odidika on Feb. 4, Attorney General Eric T. Schneiderman said, “Stealing from a program that enables seniors and the disabled to live at home and not in an institutional setting is deplorable. Those individuals who steal from this program not only steal from New York taxpayers but risk depriving others of the opportunity to live among loved ones in the comfort of their own communities. My office will vigorously pursue those individuals and companies who line their pockets with monies designated to help our most vulnerable citizens.”

According to Schneiderman, Odidika also “demanded and received kickbacks” from an NHTD program project contractor. The kickbacks would ensure the contractor would get the job. With a kickback in hand, Odidika would then falsify any other bids to ensure this contractor won the bid, according to the attorney general.

“Finally, Odidika filed claims in the transition program for moving expenses which were either never provided or significantly inflated over the actual costs,” according to Schneiderman.

Odidika and Systems and Abilities were each charged with one count of second-degree grand larceny, five counts of second-degree criminal possession of a forged instrument, first-degree offering a false instrument for filing and 10 counts of first-degree falsifying business records, all felonies.

Odidika could face up to 15 years in prison if convicted on the top count.