Nursing home official admits $600,000 fraud (Pittsburgh Post-Gazette)


Posted to Nursing

A Canonsburg woman who served as the financial controller for two nursing homes admitted yesterday to embezzling more than $600,000 from them.

Gayle Phillips-Smith, 48, pleaded guilty to one count of embezzlement from a health care benefit program and to one count of tax evasion.

According to the U.S. attorney’s office, Ms. Phillips-Smith served as the financial controller at Baldock Health Care Center in North Huntingon, and Humbert Lane Nursing and Rehabilitation in Washington, from 2001 to 2005.

Assistant U.S. Attorney Luke Dembosky said that Ms. Phillips-Smith used an ATM card without authorization nearly 500 times to remove $247,669 between August 2001 and November 2004. Further, he told U.S. District Judge Terrence F. McVerry that she used electronic transfers to her personal bank accounts to take additional money. Sometimes she disguised the payments to herself by representing them to be payments to vendors, Mr. Dembosky said.

In addition, Ms. Phillips-Smith doctored the books at Humbert Lane so that no payroll tax was withheld from her own paycheck and used electronic funds transfers to the IRS for payroll taxes for her personal business, and then later claimed refunds for the excess that was transferred.

Ms. Phillips-Smith faces a possible prison term of 37 to 46 months under the recommended guideline range. In addition to paying back $627,919.31, Ms. Phillips-Smith is responsible for $143,904 in unpaid taxes.

She will be sentenced on July 24.

First published on April 24, 2009 at 12:00 am