Healthy Start officials focus of investigation Companies may have profited illegally, Schmoke says

November 20, 1998|By Gerard Shields | Gerard Shields,SUN STAFF

Investigators looking into the possible misuse of millions of dollars at a Baltimore program for poor pregnant women have focused on relationships between former administrators and several companies with whom they did business.

Mayor Kurt L. Schmoke said yesterday that a review of the financial records for Healthy Start Inc. indicated that several area companies might have illegally profited through the relationships.

City Health Department officials confirmed Wednesday that the Baltimore state's attorney has begun a civil and criminal investigation into the $3.2 million program to help distressed women and children in Sandtown-Winchester and Harlem Park in West Baltimore.

"Some people in positions of trust may have abused that trust with some financial relationships with third parties that didn't benefit the program, but benefited the third parties," Schmoke said yesterday at his weekly news conference. "I am more than a little annoyed."

Schmoke declined to name the officials.

The scandal broke when a review of the nonprofit agency by city health directors discovered financial records indicating significant fiscal irregularities, Schmoke said. As a result, Schmoke said he supported the removal of program administrators.

Peter L. Beilenson, city health commissioner, said Wednesday that the fiscal irregularities resulted in the removal of the program's chief financial officer, Clarice E. Brown.

He said the program administrator, Executive Director Thomas P. Coyle Jr., resigned because of the problems.

An attorney for Coyle said yesterday that his resignation was unrelated to the matter.

Brown declined to comment yesterday, saying she knew nothing about the matter.

"I have been on a leave of absence since August," she said.

Schmoke, a former Baltimore state's attorney, said he directed city health officials to contact State's Attorney Patricia C. Jessamy after significant sums of money couldn't be properly accounted for. He declined to provide a figure.

Initial estimates on Wednesday put possible losses at $650,000, while sources said yesterday that the losses could be as high as $1.8 million.

While Beilenson declined to disclose the amount of money, he said he has hired an accounting firm to conduct an audit of agency spending for the past four years.

Part of the problem in tracking the money is that the agency operates independent of city government. The agency budget, which was increased from $2.5 million to $3.2 million annually earlier this year, is provided by the federal government but administered by a local board.

Steven A. Allen, a Towson attorney representing Coyle, said his client was not involved in any spending improprieties at the agency.

"Tom always conducted himself properly and above board," Allen said. "He had no relationships that were improper."

The Baltimore program received national acclaim and support reaching all the way to the White House, where Vice President Al Gore backed the increase in the budget. The number of Baltimore babies born with low birth weights has declined by 65 percent over the last five years, while the program has been in existence. In addition, infant mortality rates dropped 30 percent during the same period.

The program has assisted about 300 community advocates obtain jobs going door-to-door to recruit poor pregnant women to get prenatal care through the program.

The investigation into agency spending should not overshadow the program's achievements, Schmoke said.

Pub Date: 11/20/98

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