Former Owner of Edgewater Medical Center Pleads Guilty to Perjury for Willfully Impeding Efforts to Collect $188 Million in Civil Judgments
CHICAGO — The former owner of Edgewater Medical Center on Chicago’s North Side pleaded guilty today to a federal perjury charge stemming from his efforts to thwart attempts by the U.S. and a creditor to collect more than $188 million in civil judgments.
PETER G. ROGAN admitted that he lied in a federal affidavit when he denied controlling millions of dollars in a trust account in the Bahamas, according to a written plea agreement. Rogan acknowledged that he had control over the money and its distribution to beneficiaries, and that he had established the trust to protect his assets from judgment creditors. Rogan also admitted that he willfully violated several court orders in a bank creditor lawsuit, when he made – and caused his legal counsel to make – false representations to the Court about his control over the offshore trust.
Rogan’s false statements in the affidavit and his willful disobedience of Court orders were intended to prevent the U.S. government and the bank creditor from collecting more than $188 million in combined civil judgments arising from fraud during Rogan’s tenure as CEO of the now-shuttered hospital, according to the plea agreement.
Rogan, 69, formerly of Valparaiso, Ind., pleaded guilty to one count of perjury. Under the terms of the plea agreement, Rogan faces a sentence of 12 to 21 months in prison. U.S. District Judge Harry D. Leinenweber scheduled a sentencing hearing for Oct. 14, 2015, at 9:45 a.m.
Rogan once owned Edgewater Medical Center and later sold it, but he continued to manage the facility through various companies he owned. The hospital, located at 5700 N. Ashland Ave., closed in 2001 amidst a federal criminal investigation that resulted in the healthcare fraud convictions of a Rogan-owned management company, a hospital administrator and several doctors, the latter of whom performed medically unnecessary surgical procedures and treatments on unsuspecting patients.
After a civil trial in 2006, the United States obtained a judgment of $64,259,032 against Rogan for his role in Edgewater’s submission of false claims for reimbursement under the Medicare program. The following year, Dexia Crédit Local, a bank that extended credit financing to the hospital, was awarded a $124 million default judgment in a separate civil fraud suit against Rogan and his companies.
In the course of their respective proceedings against Rogan, the United States and Dexia discovered that Rogan’s Bahamian trust account was being used to hold millions of dollars in secret offshore assets. Rogan had created the trust with the help of FREDERICK M. CUPPY, an Indiana attorney, as well as another attorney described in the indictment and plea agreement as “Florida Lawyer.” Cuppy, formerly of Valparaiso, Ind., and now of Fort Lauderdale, Fla., pleaded guilty to a perjury charge before Judge Leinenweber. He was sentenced in 2013 to one year and a day in prison.
On Dec. 21, 2006, Rogan responded to the government’s collection efforts by filing an affidavit with the Court in which he denied that he exercised control over assets in the trust account. Rogan admitted in the plea agreement that this statement was false and misleading. Rogan also admitted that he willfully and wrongfully violated several court orders in the Dexia litigation, including lying and causing his attorneys to lie to the Court about his control over his offshore trust.
The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and John A. Brown, Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The government is represented by Assistant United States Attorneys Andrew S. Boutros, Daniel W. Gillogly, Eric S. Pruitt and Joseph A. Stewart.