SRMC Public Corruption Trial Week Two: Witnesses Pressed on Contract Details

Roy Lester Schneider Regional Medical Center on St. Thomas.

In the second week of the Roy Lester Schneider Regional Medical Center corruption trial the jury heard from two hospital administrators who worked with two of the three defendants who are now on trial. They also heard from a former chair of the hospital board who served for a time while two defendants were being hired to work at the Schneider Hospital.

Unlike some of the first witnesses to testify in the trial of defendants Rodney Miller, Amos Carty and Peter Najawicz, those who appeared after the long Columbus Day weekend faced questions about internal documents related to hiring, promotions and compensation.

Cross-examination by defense attorneys gave them a chance to show the jury examples of other bonuses and loans authorized for other hospital employees during the time when the three defendants were accused of wrongdoing. Defense lawyers also pressed the witnesses over the legitimacy of benefits that were not included in the contract officially approved by the board and sent to the government’s human resource agency, the Division of Personnel.

Miller, Carty and Najawicz are accused of taking $2.8 million in hospital funds by awarding each other bonuses, stipends, raises and perks and bypassing the payroll system by sending the funds to a private bank account they used as a slush fund. Details of the scheme are outlined in an amended criminal charging document filed by prosecutors.

The first of the week-two witnesses was Karen Renee, who served as Miller’s executive assistant from 2003, when the Notice of Personnel Action – processed through the Division of Personnel – made his appointment as hospital chief official. Renee told the court she saw Miller’s contract and signed on as a witness to the signatories.

But under questioning by defense attorney Robert King, Renee said she was not familiar with the contract details.

“It wasn’t a secret to you that the board knew Mr. Miller was collecting educational stipends?” King said.

“I cannot speak to that,” the witness said. Another witness, Beverly Chongasing, gave a similar reply when asked by prosecutor Tigrid Tejo-Sprotte if she remembered talk about educational stipends coming up in board discussions.

Tejo-Sprotte pointed to one section of the contract and asked Chongasing if it included any additional reimbursements for Miller to attend classes at a college or university.

The former board chair said no.

Rodney Miller
Rodney Miller (Source file photo)

Then the witness was presented with a document, a voucher for $3,061, marked as a reimbursement for “tuition costs incurred for the month of August 2004.”

“Who signed, approving that voucher,” Tejo-Sprotte asked.

“Rodney Miller,” the witness said.

The next set of documents presented to the witness and the jury were checks written from the bank accounts of Rodney Miller and wife Ronica Miller for $2,836 and $225, respectively. The checks were to be paid to the Medical University of South Carolina.

“You were aware that Mr. Miller’s education reimbursements totaled $78,000?” Tejo-Sprotte asked.

“Vey unaware of it,” the witness said. The first time she became aware of it, she said, was when she met with Tejo-Sprotte for a pre-trial interview.

Tejo-Sprotte also walked Chongasing through a portion of Miller’s contract that granted funding for professional development. The contract said Miller could attend up to two conferences a year at a cost not to exceed $2,500.

“Was the payment to the medical school consistent with the provision in the contract that allowed for professional development?” the prosecutor asked.

Chongasing answered “no.”

Witnesses appearing during the first week of testimony were also asked whether Miller was entitled to education reimbursements under his official government contract. Former Personnel Director Kenneth Hermon told the court he had never heard of that kind of benefit included in a contract.

The administrator for the hospital legal counsel’s office also told the court she viewed Miller’s 2003 contract. Under questioning by defense attorney Gordon Rhea, Spencer said she handled the document for filing because her office was responsible for those kinds of documents.

Rhea asked about other personnel documents Spencer had seen authorizing compensation over the amount spelled out in their government contracts.

Spencer said they came from Miller. The former CEO felt those employees earned bonuses through their work to help the hospital earn a coveted accreditation status.

“Mr. Miller, after achieving Joint Commission, felt they should be rewarded,” Spencer said.

In her testimony, Chongasing explained how the hospital board decided to set Miller’s salary at $150,000 when he first took the job.

The board’s first offer was $135,000, but it attracted few applications. One candidate went through about two weeks of negotiations and offers but finally turned it down, saying the salary was too low, the witness said.

Prosecutors presented a set of notes Chongasing took during the interview when Miller received the $150,000 offer. The note read that the candidate felt the salary level, along with a $20,000 annual housing allowance and professional development allowance was “fine.”

The new chief executive said he would like to receive the housing allowance in quarterly payments.

But the next set of documents presented in court showed something different than what the parties agreed to. One check was marked as a “housing allowance advance” for $45,500.

“Who signed the check?” Tejo-Sprotte asked.

“Rodney Miller and Mr. Najawicz,” the witness said.

Chongasing was asked if she recalled the board discussing or amending Miller’s contact to include a provision for a housing allowance advance.

Again, the witness said no.

Testimony is expected to resume Monday in Superior Court with Judge Michael Dunston presiding.

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