Records offer window into FBI investigation

O.B. has spent $453,071.67 defending against the Justice Department.

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Executive session minutes raise question about FBI investigation. - Rich Saltzberg

Updated 

Executive session minutes obtained by The Times through an Open Meeting Law request allege that former Oak Bluffs Fire Chief John Rose “committed fraud,” something he adamantly denies. The minutes reflect the federal probe into the billing practices of the Oak Bluffs Fire and EMS Department, and aren’t detailed enough to indicate who in particular believes Rose was culpable of fraud. As The Times previously reported, the FBI began to burrow into the department in 2019. A grand jury was slated to convene in January 2020. Other records recently obtained by The Times indicate several people testified before a federal grand jury. 

Reached Friday afternoon, former Chief Rose denied the fraud allegation. “That’s absolutely not true,” Rose said. “I adamantly deny any wrongdoing.” Rose went on to say he and his department strove to adhere to laws and regulations governing Medicaid, and ran all invoices through a professional billing company. 

The minutes, which represent a virtual meeting held on Sept. 22, 2020, express the opinion the Justice Department, referred to as “the government,” would “‘walk away without criminal charges,” based on information from a “well-placed source,” because the dollar amount in the case is too small. However, elsewhere, the minutes indicate a belief “the fraud was broader.” Whether or not that represented the opinion of the Justice Department is not clear — who or what held that opinion is only described as “they.”

When asked Friday if the minutes reflected federal opinion on the investigation at that time, FBI spokesperson Kristen Setera told The Times the agency would decline comment. 

On Monday, after being emailed a similar question, the U.S. Attorney’s office for Massachusetts wrote, “We do not confirm or deny investigations.”

Rose’s attorney, James Tewhey, discounted the minutes, and said since they were generated, nothing has come of the investigation. 

Tewhey questioned The Times’ understanding of the billing process that has been under federal scrutiny, and said, “Maybe John Rose became a convenient target to hide, to deflect, from other people’s incompetence.”

At the time this investigation was ongoing, Rose was facing allegations of sexual misconduct. The town ultimately settled that case, and a short time later, Rose resigned from the department.

When asked how the fire and EMS department was able to charge seemingly exorbitant amounts of money to transfer patients from Martha’s Vineyard Hospital to the helipad behind the hospital for airlifts, Tewhey said, “And the question becomes, Who came up with the figure[s]?” 

Tewhey said his client didn’t benefit from the billing. “There was an institution that did benefit from this,” he said.

When The Times asked if he meant the town of Oak Bluffs, Tewhey said, “Absolutely accurate.” He said the town benefited “enormously.”

Former Oak Bluffs Police Chief Erik Blake said the FBI mostly spoke to him as a courtesy when they were on-Island conducting the investigation. However, Blake said, they did ask him about police vehicles paid for by the ambulance reserve fund, which was funded by the ambulance billing. Blake said he told the FBI such vehicle purchases were approved on the town meeting floor through a fund he had no control over.

Blake said when he later became Oak Bluffs director of public safety, he questioned some past ambulance practices, such as transferring patients from one ambulance to another in Woods Hole when insurance companies will only compensate for “facility to facility” transfers. Blake questioned why “the powers that be” didn’t put a stop to such practices, and instead let them go on for years. He also questioned why such practices were ever allowed to arise. 

In speaking with The Times, Tewhey continued to suggest responsibilities for any billing anomalies lay elsewhere, and that the town made out handsomely from the ambulance reserve fund. When it was pointed out the fire department benefited in a number of ways from the ambulance reserve fund, and there might have been incentive for a conspiracy between Rose, his department, and town hall, Tewhey said, “If anybody can produce evidence that that’s true, I’ll speak to that.”

Tewhey questioned if the billing was subjected to audits and oversight, and stressed too much emphasis has been placed on Rose, and not enough scrutiny has been exercised elsewhere.

Tewhey also said he believed a number of individuals were granted immunity, yet the investigation still hasn’t produced indictments. “Nobody, to this point, has provided one scintilla of evidence fraud was committed,” Tewhey said. 

Asked why the Justice Department hasn’t conclusively announced its investigation is done if, as he alleges, there’s nothing to find, Tewhey said it was par for the course in investigations of this type for the government not to comment. 

The executive session minutes largely reflect a report to the select board by the town’s attorney, David Apfel, and another, unnamed attorney who represented Rose.Tewhey said that may be a reference to him, but he was unsure. The minutes state Rose’s attorney spoke with a “source” who felt “the amount of money is so small, it should not be treated as a federal or criminal matter.”

Tewhey said he did speak with investigators, but wasn’t sure the minutes referenced his interactions with them. Overall, he said the minutes did a poor job of identifying where information and positions came from. The minutes mention fire and EMS department staffer Matt Bradley, and state, “The feds think” he “made false statements.” Bradley didn’t immediately respond to email questions regarding the minutes. 

Invoices show Apfel, through the firm Goodwin Procter, charged the town $1,220 per hour for legal representation. Apfel, whose Goodwin Procter profile describes him as “a former federal prosecutor who specializes in white-collar criminal defense,” represented the Field Club in Dukes County Superior Court in June when it pleaded guilty to corporate involuntary manslaughter caused by wanton or reckless conduct in the drowning death of Henry Bowman Backer. Apfel’s fees and those generated by other members of the firm have amounted to $453,071.67 thus far.

On Friday, Apfel didn’t immediately respond to a voice message seeking comment. 

In response to an email inquiry about the payment of Goodwin Procter fees, town administrator Deborah Potter wrote, “Legal invoices were paid from the general fund. Two of the invoices (1843893 for $47,204.65 and 1856568 for $9,593.60) were paid from a special article authorized by vote at STM June 16, 2020. Legal invoices, after review by the department head for accuracy, are then paid by warrant. Of the 22 invoices provided, nine warrants were executed by Alice Butler, nine warrants were executed by Wendy Brough, two warrants were executed by Robert Whritenour, one warrant was executed by Deborah Potter, and one warrant was missing its signature. The payment of all town bills are also executed in their totality by the select board.”

When asked about the minutes, select boad chair Ryan Ruley declined to comment until he could review them and confer with Potter. He later declined to comment at all. 

The Times has filed an Open Meeting Law complaint against the select board, alleging, among other things, that the minutes are insufficiently detailed. 

Updated with a comment from the town administrator.

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