Massive Check Fraud Uncovered at Department of Developmental Disabilities
Former Montgomery Developmental Center (MDC) employee Doug Carter stole over $440,000 from the Ohio Department of Developmental Disabilities (ODODD) and the agency’s disabled residents, according to State of Ohio Office of the Inspector General (OIG) findings released February 22. MDC is a Medicaid-funded “residential training center” for adults with severe mental and physical disabilities, serving 8 counties in western Ohio.
While working as a business analyst at the Warrensville Developmental Center (WDC), Carter allegedly issued six checks payable to cash, forged a coworker’s signature, and stole more than $4,500 from the ODODD facility. Soon after being permitted to transfer to MDC in August 2009, Carter assigned himself additional control over the office’s funds and bookkeeping before committing similar fraud on a much larger scale, OIG investigators reported.
The photo shown above was taken by a Wright-Patt Credit Union security camera; based on OIG findings, on February 16, 2012, Carter issued an MDC check for $5,280, cashed it, and then deposited $5,280 into his personal Wright-Patt Credit Union acount.
At MDC, Carter allegedly forged supervisor Robert Dix’s signature on 133 checks and evaded detection for years by falsifying records in QuickBooks. OIG investigators claimed that “Dix could have identified discrepancies in the client funds bank account and QuickBooks records as early as April 2010. Instead, these discrepancies were not discovered until after the Credit Union of Ohio contacted Dix on March 12, 2012.”
Carter was fired on March 29, 2012, and Dix was fired two weeks later.
In total, OIG alleged that Carter issued nearly 150 fraudulent checks worth $440,436.33 from mid-2009 to early 2012. Carters purchases during that period included a 2009 Kia Borrego, a $6,500 engagement ring, and the down payment on a 2011 Chevrolet Camaro SS.
According to OIG, the Camaro has been repossessed and Carter’s fiancée left him when he confessed his crimes to her via text message during the investigation.
Regarding Carter’s time at MDC, OIG found that he “changed the duties of one of his account clerks to strictly payroll duties, eliminating the clerks management of the resident funds, and began cashing checks issued payable to cash and keeping the money for his personal use.”
The OIG report continued, “By changing the responsibilities of key staff members, and having the opportunity to manipulate QuickBooks without management approval, Carter issued 133 checks payable to cash from the client funds bank account totaling $403,305.71 and two checks payable to cash from the industrial and entertainment bank account totaling $6,790 during the period from October 29, 2009, through March 8, 2012. Carter signed his name to these checks, forged Operation Director Robert Dixs signature, endorsed and cashed the checks, and kept $410,095.71 for his personal use.”
“The lack of managerial oversight also allowed Carter to issue five checks for a total of $25,824.12, inserting his own name as payee, forging both Dix and MDC Superintendent Nancy Banks’ signatures as makers, then endorsing and depositing each check into his personal bank account.”
Of his alleged theft from WDC, Carter told investigators that he felt he “deserved the money.”
The OIG report listed a number of specific incidents in detail. For example, “On August 26, 2011, Carter issued an MDC check payable to cash for $9,700, endorsed, and cashed the check. Carter deposited $7,000 in cash into his personal bank account on the same day and deposited an additional $2,500 in cash on August 27, 2011. This deposit occurred three days before Carter used his debit card to pay a plastic surgeon $5,000 on August 29, 2011, and $1,500 on August 30, 2011.”
OIG investigators noted a general lack of consistency and supervision at ODODD facilities, and recommended that uniform accounts reconciliation and documentation processes be implemented at MDC, WDC, and other locations across Ohio.
The inspector general’s investigation was conducted with help from local authorities and the Ohio State Highway Patrol. OIG plans to forward copies of its report to prosecutors in Cuyahoga County and Montgomery county, as well as to the Ohio Office of Budget and Management and the Ohio Auditor of State.