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Community
Mental Health Fraud in the U.S.
In 2003, financial audits discovered that Kedren Community Mental Health Center
in California had misspent $1.4 million in funds, including paying for its president�s
Land Rover vehicle and Cadillac, and for some employees� theater tickets and
trips to Las Vegas, New Orleans, Georgia, Washington, D.C. and London.
In 1990, a U.S. Congressional committee issued a report estimating that Community
Mental Health Centers (CMHCs) had diverted between $40 million to $100 million
to improper uses. Various CMHCs had built tennis courts and swimming pools with
their federal construction grants and, in one instance, used a federal staff
grant to hire a lifeguard and swimming instructor.
The misuse of funds continued despite the congressional report. In September
1998, Medicare barred 80 CMHCs in nine states from serving the elderly and disabled
after investigators found patients had been charged $600 to $700 a day for watching
television and playing bingo, rather than receiving any care.
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