November 10, 1996 in City

Man Accused Of Taking $244,000 Aids Foundation Sues Former Employee For Embezzlement

Associated Press
 

The Northwest AIDS Foundation has sued a former employee, claiming he took $244,000 meant to provide health insurance for AIDS patients by funneling it into phony insurance accounts.

The former employee, Tim Menard, said he had been cautioned by his attorney not to discuss the case, but told The Seattle Times: “The only thing I can say is I’m so, so sorry if this hurts people with AIDS, if this hurts the program or the foundation. I don’t know how I’ll live with that.”

Menard, 44, said he has AIDS and “never thought I’d be alive when this happened. … I thought I’d be dead.”

Menard was fired last week after eight years with the not-for-profit foundation. The program administers about $3 million a year in state money for about 800 AIDS patients who do not qualify for Medicare.

The foundation’s King County Superior Court lawsuit seeks to recover $244,000 from Menard. The alleged losses will not affect AIDS patients because the foundation is insured.

The lawsuit was based on information from a private investigator and outside auditing firm. That information was forwarded to the King County prosecutor’s office, where a spokesman said an investigation will be conducted. Criminal charges have not been filed.

The civil suit alleges that more than four years ago, Menard began channeling money from the Evergreen Health Insurance Program for uninsured AIDS patients into accounts he controlled.

It claims Menard collected benefits for seven fictitious patients and sent the money to bank accounts he created for two phony health insurance companies.

“There was shock and outrage when we discovered this,” board Treasurer Jim Hanson said. “It was a very elaborate scheme. The files contained information like false names, Social Security numbers and even thank-you notes and correspondence from all sorts of places,” he said.

“There was disbelief, too,” board President Paul Neal said. “This employee was one of the first people with the foundation and was very well liked here and in the community.”

After verifying the phony accounts, the foundation board began an internal review of its own processes, and hired an accounting firm to review work done by its regular auditors, Executive Director Terry Stone said.

Letters were sent to clients Friday, assuring them that their health insurance is intact.

“We are fortunate in that we are always within the operating budget in this program, so clients don’t have to worry about not being covered,” Stone said.

© Copyright 1996 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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