Sunday, November 1, 2020

Ex-Lobbyist in Multi-Million Dollar Medicaid Fraud Sentencing Set for Nov 25


Milton “Rusty” Cranford, the lobbyist at the heart of a multimillion-dollar Medicaid fraud scandal, will be sentenced Nov. 25, according to court records posted Tuesday.

The setting of a sentencing date comes five weeks after an Oct. 8 bond hearing for Cranford. Federal Magistrate David P. Rush noted at the hearing that Cranford, 60, has spent an unusually long time awaiting sentencing.

The former lobbyist is expected to testify in the trial of his indicted employers, which isn’t set to begin until April 2021.

Cranford has remained in the Greene County, Mo., jail in Springfield since his Feb. 21, 2018, arrest at his Bentonville home on bribery charges.

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Cranford pleaded guilty to one count of federal program bribery on June 7, 2018. He could face up to 10 years in federal prison. Neither his defense attorney nor the U.S. attorney’s office for the Western District of Missouri offered a comment when asked Tuesday.

Since his guilty plea, Cranford has appeared three times before federal grand juries in the corruption investigation, has met with federal investigators 10 times and has also met with investigators for Arkansas, federal prosecutors confirmed during the bond hearing.

Five former Arkansas lawmakers, four of whom were serving in the Legislature at the time of the bribes or who partnered with Cranford in the scheme as a lobbyist after leaving office, have been convicted so far in the two-state federal investigation involving Cranford. They are: former Rep. Micah Neal and former Sen. Jon Woods, both Springdale Republicans; former Rep. Eddie Cooper, D-Melbourne, who joined Cranford’s lobbying firm; former Rep. Henry “Hank” Wilkins IV, D-Pine Bluff; and former Sen. Jeremy Hutchinson, R-Little Rock.

All the convictions involve bribes paid by Cranford to benefit Preferred Family Healthcare of Springfield, Mo., which was one of Arkansas’ largest Medicaid recipients for behavioral health services before the scandal broke in 2017.

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Hutchinson, the most recent, pleaded guilty June 25 to conspiring to commit bribery involving an orthodontist who sought favorable legislation and to one count of filing a false tax return. Hutchinson also pleaded guilty July 8 to conspiring to defraud Preferred Family.

Along with Hutchinson, federal prosecutors in Missouri charged the married couple who ran Alternative Opportunities of Missouri before its 2015 merger with Preferred Family with conspiracy, bribery, fraud and falsifying tax returns.

Chief Operating Officer Bontiea Goss and Chief Financial Officer Tom Goss have pleaded innocent to the charges.

Chief Executive Officer Marilyn Nolan pleaded guilty in the case.

Nolan and the Gosses were dismissed by Preferred Family’s board after the scandal broke. Other now-former executives of the company also face charges.

A federal grand jury in Missouri indicted Cranford on one count of conspiracy and eight counts of accepting bribes.

The case against Cranford relates to illegal lobbying for Preferred Family, which operated substance abuse and behavioral health treatment centers in five states, including Arkansas. It had 47 sites in Arkansas alone before having to sell them after losing its state Medicaid certification because of the scandal.

Cranford and other executives embezzled at least $4 million from the nonprofit group between 2011 and January 2017, according to federal prosecutors. Most of the money paid for illegal lobbying Cranford helped direct, according to his guilty plea.

Cranford first registered as a lobbyist in Arkansas in 2005, secretary of state’s office records show. His lobbying firms over the years include Cranford and Associates and the Cranford Coalition.

In 2007, Cranford became an employee and manager of Alternative Opportunities. Preferred Family and Alternative Opportunities merged in 2015. The company has used the name Preferred Family since.


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