Home News Stories 2004 July Nursing Home Owner Pleads Guilty to Fraud

Nursing Home Owner Pleads Guilty to Fraud

Lifestyles of the Rich and Crooked
Nursing Home Owner Pleads Guilty to Cheating Residents out of Medicare Millions

bornehome.jpg

07/12/04

Melville Borne Jr. lived in the lap of luxury. He divided his time between two homes in Louisiana, one of which was a $4 million, 150-acre riverside estate known as Annedelle Gardens (shown above), with a refurbished historic plantation, man-made ponds, exotic swans, and a staff that included two full-time groundskeepers. His main residencein an exclusive, gated community near New Orleanswas no shack, either.

How did he finance these extravagances? He cheated elderly patients in the three nursing homes he owned.

They suffered:

  • Grossly inadequate staffing
  • Threadbare bed linens
  • Broken air conditioning
  • Shortages of such basics as soap, bandages and towels
  • Limited food supplies
  • Broken washing machines
  • Critical therapeutic equipment that rarely worked
  • Limited social services or activities

That's because instead of using the millions of dollars in money he received from Medicare and Medicaid to run his nursing homes, Borne was diverting it to pay the mortgage and other costs at Annedelle Gardens, as well as the expenses of both a development company and a construction company he ownedin addition to paying himself a generous salary of over $250,000 a year.

As if that wasn't bad enough, he was also using the money nursing home employees contributed to their 401(k) pension plans as an interest-free loanfirst taking it to pay his personal expenses and then sending it to the pension plan months in arrears.

After a joint investigation by the Department of Labor, the Department of Health and Human Services, the Office of the U.S. Attorney for the Eastern District of Louisiana, and the FBI's New Orleans Office, Borne pled guilty in June to failing to provide care and services to residents in his nursing homesthe first plea of its kind. He also pled guilty to pension fund fraud.

Happy ending. We're glad to say that new ownership of the three nursing homes brought them up to code. Their elderly patients are now receiving good care and services.

We love these kinds of turn arounds. In the words of Louis Reigel III, special agent in charge of our New Orleans office: "Anyone preying on our elderly or defrauding the government will be pursued through aggressive investigation."