Lori A. Savage wrote 85 checks worth nearly $73,000.
RANGELEY – A Madrid Township woman pleaded guilty Thursday to engaging in a health-care fraud scheme to embezzle nearly $73,000 from a Rangeley dentist.
Lori A. Savage, 34, former office manager for Dr. David McMillan, allegedly diverted funds to pay her own credit card bills and other expenses.
Savage entered the plea in U.S. District Court in Bangor. She faces up to 10 years in prison and/or a fine of up to $250,000.
According to court records, between Feb. 1, 2000, and Oct. 29, 2002, Savage was the office manager of Rangeley Family Dentistry, a health-care benefit program, which receives payments for services from Medicare and Medicaid programs.
Without McMillan’s authority, Savage “prepared and executed” 85 checks from the Franklin Savings Bank account of Rangeley Family Dentistry for her own personal use in paying credit card bills and other expenses in her name or the name of a family member, a release from the U.S. Department of Justice stated.
Savage also made false entries into the dentistry practice’s computerized ledger to conceal the scheme by entering payees and items into the ledger that had never been approved by McMillan, who owns the practice, the release stated.
Savage also used McMillan’s stamp signature on the checks without the dentist’s permission.
The case came to light last November after McMillan noticed a $1,000 discrepancy in a payment to a supplier recorded in his computerized records.
McMillan continued to check his records and brought in his accountant to do an audit, and then took his findings to state prosecutor Jim Andrews.
After reviewing records for 2000, accountant Richard Walker found that 37 checks totaling $25,114.65 were paid to four different credit accounts that did not belong to McMillan. Those accounts were Fashion Bug, Capital One, Universal Card and First Card. The checks were recorded in McMillan’s office computer system as expenditures for lab and office supplies, according to an affidavit filed by Franklin County Sheriff Detective Tom White in 2002.
Walker’s audit demonstrated that in years 2000, 2001 and up to Oct. 31, 2002, that $72,956.81 had been diverted to the four credit cards belonging to Savage, White’s affidavit stated.
McMillan used personal credit card(s) to pay for supplies and other services for his business. Savage printed all checks from the business using the computerized system and validated those checks with a rubber stamp containing the dentist’s signature, the affidavit stated.
Savage who also owned her own bookkeeping service, had allegedly used some of the money to buy “very expensive, top of the line” computer equipment.
Savage was paid $13 an hour by McMillan.
White, Rangeley Police Chief Philip Weymouth and others conducted an investigation with assistance of members of the Tri-County Property Crimes Task Force and the Maine Computer Crimes Task Force. The U.S. Department of Health and Human Services also conducted an investigation.
Once the case was put together, the U.S. Attorney’s Office reviewed it and decided to prosecute it, White said Friday.
U.S. Attorney Paula D. Silsby praised the investigative work of those involved.
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