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July 20, 2006
WHISTLEBLOWER WINS
| ST. JOE NO GO |
FICKLE FEMA?
WHISTLEBLOWER
WINS: A five-week trial ended Friday in Humboldt County Superior
Court with the jury ruling in favor of former Mad River Community
Hospital (MRCH) administrator Charlene Pellatz in her lawsuit
against the Arcata hospital for retaliatory termination. Reached
Monday at the county Department of Public Health, where she now
serves as the local Emergency Response Coordinator, Pellatz was
in good spirits following what she called a "long and difficult"
proceeding. "I am very glad that the process was successful
and that it is over," she said.
Pellatz was fired in November 2001, four months
after she approached the hospital's board of directors with two
complaints: One, that MRCH was not adhering to Stark laws —
federal anti-referral/anti-kickback statutes that regulate doctors
and the hospital — and two, that the hospital did not receive
building and licensing permits required by state and local agencies.
Beyond those basic facts, neither Pellatz nor her Eureka attorney,
Alan Goldberg, would spell out the details of the misdeeds alleged
against MRCH. "I don't want to harm the hospital,"
Pellatz said.
Pellatz, 58, was employed at the privately-owned
institution for 21 years and worked as an assistant administrator
under CEO Doug Shaw for more than eight years. Shaw took the
stand during the trial, and according to Goldberg, the CEO admitted
to firing Pellatz, in part, for bringing allegations to the board
in 2001. "He had other reasons as well," Goldberg explained
Friday. "He felt she wasn't performing as he wanted her
to." The prosecution sought over $1 million in damages from
the hospital, but was awarded only $229,532 for lost wages, benefits
and emotional distress. "The jury felt these were the appropriate
damages and I know they were very sincere; we talked to them
afterward," Goldberg said.
When reached on Monday, Mad River Hospital Spokesperson
Tom Ayotte did not know whether MRCH would appeal. He said his
employer "wants to move on," though management disagrees
with the jury's verdict. According to Ayotte, the MRCH board
of directors conducted an investigation into Pellatz's claims
in 2001 and found the allegations to be unsubstantiated. Once
a formal judgment is finalized by Humboldt County Superior Court
Judge John T. Feeney, the hospital has 60 days to file an appeal.
— Helen Sanderson
TOP
ST. JOE NO GO: Four
months after due diligence talks began between the pauperized
St. Joseph Hospital of Eureka and North Carolina-based Hospital
Partners of America, which operates Shasta Regional Medical Center,
the potential out-of-town buyer has backed out, the hospital
announced last weekend. The decision to end discussions, the
hospital reported, was met mutually.
HumCo's biggest medical facility is still get-able
for some party willing to take over the Catholic nonprofit's
$70 million debt and also finance $80 million-plus worth of seismic
upgrades to the Harrison Avenue facility by 2013. St. Joe's additionally
insists that the new owners "commit to the community."
But beyond selling the hospital, two other options remain —
keep it and pray for some major philanthropy or create a community-based
hospital funded through taxes.
A task force comprised of the Community Health
Alliance of Humboldt-Del Norte and Dr. Ann Lindsay, Humboldt
County's Public Health Officer has spent recent months kibitzing
with community stakeholders (including a forum of local journalists)
to identify which of those three choices — sell, stay or
switch — is the best fit for the North Coast. The Community
Health Alliance's report will be given to St. Joe's by July 31
and will also be presented to the county board of supervisors
at their July 25 meeting. Then, St. Joe's own task force will
review the other task force's review and discuss their findings
at a board of trustees' meeting in late August.
—Helen Sanderson
TOP
FICKLE FEMA? Lord
knows, FEMA works in mysterious ways. That's the Federal Emergency
Management Agency, ready to step in with much needed emergency
dollars when your need arises, or preferably before: to rescue
you from rising flood waters, to keep your hay field from death
by seawater, or, one might assume, to stop your house from sliding
into the ocean or a river or whatever.
Naturally, not every request for the FEMA goodness
can be granted. The project has to be justified. Take the Sacramento
Valley levees, which are getting attention these days in the
scary wake of Hurricane Katrina in the South. FEMA money is going
toward preventing those levees from failure — good for
the sake of hundreds of thousands of lives in that low-bottomed
valley, good for the fed's bruised reputation.
And take the Arcata and Jackson levees, 4.9 miles
of more-than-a-century-old rock rip-rap berms that stretch alongside
Route 255 from the Arcata Marsh to Mad River Slough. FEMA is
about to announce this week that it's committing $4.23 million
to fix up some problem spots in the berms caused by the 2005-2006
New Year's storm. The California Office of Emergency Services
is committing $1.4 million more.
"I'm surprised," said Arcata resident
Domingo Santos, president of State Reclamation District No. 768,
which governs the levees. "I'm shocked. But we were looking
for help to protect our lands from saltwater intrusion. We have
saltwater right now in one area — 40 acres are ruined.
It's killed all the grass."
Santos was also a little surprised the press knew
about the money. ""How'd you hear about it?" he
asked suspiciously. "We haven't publicized it yet."
The district was planning to announce it at its Wednesday night
meeting this week.
Well, U.S. Senator Dianne Feinstein announced the
FEMA/OES money for the levees on July 10, noting emotionally
in her news release, "At the onset of this year, the Arcata
and Jackson levees in Humboldt County sustained severe storm
damage that desperately required a speedy response. With FEMA's
approval of a $5.6 million grant, California will be able to
move forward with the repair process and return the levees to
their original conditions."
Feinstein's people also beat FEMA to the punch.
On the phone Tuesday, FEMA spokesperson Ana Marcelo echoed Santos'
curiosity: "How did you hear about this? We did not announce
this yet."
Santos said the levees protect the 1,500 acres
in the district, which include former (historic) dairyland, current
dairyland and beef ranches, as well as some state Fish and Game
land (500 acres) and some City of Arcata land. "But more
land outside of that is affected," Santos said. "There's
value out there, and a lifestyle. And it helps the economy, although
not as much as it used to. It's an asset to the community, and
always has been."
He said the levees are private, and this is the
biggest chunk of public assistance the district has ever received,
aside from a 40-year loan and small grant given the district
three years ago to fix a breach.
Another project that sought FEMA funding earlier
this year was rejected. The McKinleyville Community Services
District had applied for $1.3 million to fix the Mad River Bluff,
along which a number of modest homes now perch precariously above
the river near where it enters the ocean. Winter storms, and
the river's altered course, accelerated the bluffs' erosion.
Thomas Marking, MCSD general manager, said he's never heard formally
from FEMA about the rejection. The homes on the bluff are private,
and individual homeowners don't qualify for FEMA assistance,
he said. The public water and sewer lines hooked up to five houses
out there would amount to about an $80,000 potential loss, Marking
said — so maybe FEMA figured that wasn't enough to warrant
assistance.
Marcelo said indeed that only public facilities
can get FEMA funds. "Even though those two levees are not
flood-control, they're considered public facilities because they're
used for reclamation," she said.
A more cynical assessment — proffered by
a cynical bystander — is that the $5.6 million for levees
looks good, "levees being the issue of the day." Good
for Feinstein. Good for FEMA. And, on an entirely uncynical note,
good for the farmers and ranchers.
Santos, for his part, was sad to hear about Mad
River Bluff's rejection. "I'm sorry they didn't get any
help," he said. "But I'm grateful we did. We don't
have that kind of money."
— Heidi Walters
TOP
Scam attack
Beware the friendly man who writes his checks in advance
by LUKE T. JOHNSON
It goes something like this.
It's late on a Wednesday evening and dozens of
Japhy's customers bustle around inside. A line swells from the
front counter of the soup and noodle joint through the beaded
entryway, as hungry patrons filter in from the Northtown Arcata
sidewalk. A man in a baseball cap and sunglasses steps to the
front of the line.
He looks normal enough: pale skin, mid-40s, medium
height, white hair. He's confident and polite, seems trustworthy.
He takes a look at the soup cauldrons in the display case to
his left. He asks if he can see the vegetable vegan option. The
young clerk obligingly lifts the requested lid and stirs the
cauldron's contents. The soup is bursting with chunks of fresh
vegetables and wholesome goodness.
"Ooo that looks tasty. I'll have three bowls
of that and a couple bowls of your peanut curry," the man
says with a friendly smile. "To go."
Another employee begins ladling up the man's order.
His three bowls kill off the remainder of the vegetable soup,
so she wipes away the option on the dry erase menu board. Hopeful
vegans in line groan with disappointment.
"That'll be $20," the clerk tells the
man.
"I'm sorry. All I have is this check. I already
wrote it out," he replies, seeming to be genuinely distraught
at the inconvenience he poses. He hands her a light green check
written out for $100. It's from Security First National Bank
in Boron, Calif.
"That's too much," the clerk says, suspiciously.
"Well I was hoping you could give me some
change. You see, my family and I are on our way back home —
we have a long drive south back to Boron. I need some cash for
gas money." He has taken off his sunglasses now and is looking
the clerk in the eyes, begging for her help. She looks past him
and sees that the soup queue has grown out the door and onto
the sidewalk. People are getting impatient. She takes the check.
"OK, is that your license number?" she
asks, pointing to the string of numbers the man has scrawled
across the top of the check.
"Yes, well, it's actually the license number
of my fishing boat. You see, I lost my wallet a few days ago
and that's the only I.D. I have."
"And you are Gertrude E. McKay?" she
asks, referring to the feminine name on the check.
"That's my wife," the man replies, carefully.
"She's in the car with the kids."
The clerk looks at the check and back into the
man's eyes. He seems to understand the shakiness of his story.
But she sympathizes, and sees this as an opportunity to help
out someone in a jam. She rings the register, and counts out
$80 in change.
"Thank you so much," the man says. "I'm
gonna go tell my wife it'll be just a minute. I'll be right back."
But he never comes back. As most outside observers
will surmise, Japhy's Soup & Noodle has fallen victim to
a surprisingly common forgery scam.
Police say that check fraud and forgery have become
a real problem in Humboldt County, especially over the last couple
of months. According to the Arcata Police Department, a lot of
cases involve checks that people print out on their home computers,
sometimes with real business names, sometimes with fictitious
names. Many cases involve actual stolen checks that people try
to pass off as their own, a mild form of identity theft.
"I would say a week doesn't go by that we
don't take multiple calls about forged checks," said APD
Officer Dok Weiler, who is following the Japhy's case.
Charles Bruce, director of the National Check Fraud
Center in Charleston, S.C., said that check fraud happens everywhere.
"If a business accepts checks, there is most likely going
to be fraud," he said. "I have not seen a business
yet that has not received a bad check." He said that a deliberate
verification process is the only way to defend against check
fraud.
Local police echoed Bruce's warning, adding that
fraudsters usually attack bigger businesses, especially grocery
stores like Ray's and Safeway, which have hundreds of customers
coming in and out all day long. Even though smaller businesses
like Japhy's may not expect scams to take place in their store,
the question remains: Why would a business accept a check without
at least verifying the I.D. of the customer?
"No one has ever given me a good answer to
that question," said Lt. Ryan Peterson. "You just need
a little bit of a sharp eye. If someone is highly suspicious,
red flags should be going up."
Officer Weiler said that once people succeed in
scamming a business they are more likely to go back for more.
"Most people around here are not good at forgeries,"
he said. "But someone will find a pattern that works for
them and try it again and again."
Japhy's, unfortunately, has learned this the hard
way. This most recent scam, which took place on June 14, was
the third time in about six years the pale-skinned man with the
sunglasses has pulled some variation of the above stunt, said
Josh Solomon, who owns the restaurant with his wife. After it
happened the first time six years ago, Solomon said, he had to
bite the bullet, assuming he'd never see the fraudster again.
The second time (on September 23, 2002) was a far more egregious
affair. The man posing as Gertrude McKay gave the clerk a $200
deposit slip from Bank of America, which she blindly accepted
and cashed out, much to the bewilderment of Solomon.
"We tell all our new hires about it, but sometimes
they forget," he said.
Though one of them forgot on June 14, the third
time seemed to be the charm for Japhy's. Invigorated by his continued
success, Mr. Gertrude McKay tried to hit Japhy's once again,
only three days later, at their Oyster Festival booth. Wise to
the scam this time, the Japhy's employee took the check and promptly
called the police. But the man had disappeared into the crowd.
Japhy's Northtown neighbors, Folie Douce, did not
fare so well at the Oyster Festival, however. Seemingly undeterred
by his failed attempt at the Japhy's booth, the scamming journeyman
ventured over to the Folie Douce booth with the same story and
a check made out for $100. Green to the world of check fraud,
an unsuspecting employee fell for the trick.
"I [didn't] think we're the kind of establishment
he would try that at," said Marsha Lenz, owner of Folie
Douce. "I'm definitely surprised, but not that surprised
— there is fraud everywhere."
Police have been able to track down a good number
of these check scammers. "We have had a very good success
rate for our size department," Lt. Peterson said. He pointed
to the recent apprehension of five alleged scammers responsible
for passing a spate of forged checks from Fortuna to McKinleyville.
But fighting check fraud places added stress on a police force
already strapped for resources. Peterson said it's important
for people to destroy any old checks and to be especially careful
with credit card checks, which usually get mindlessly discarded
with the rest of the junk mail.
But the onus still falls on the businesses that
are accepting bad checks, Peterson said. "It's a preventable
problem. Just make sure the person standing in front of you has
an I.D. When in doubt, don't take it."
TOP
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