Former Memorial Hermann Employee Sentenced for Embezzling Nearly $10 Million

HOUSTON – The former manager of Printing and Mail Services at Memorial Hermann Health Systems has been ordered to federal prison after defrauding his employer of nearly $10 million over a 14-year period, announced U.S. Attorney Kenneth Magidson. Kenneth Joseph Wild II, 50, of Katy, entered a guilty plea April 22, 2015, to one count of mail fraud.

Today, U.S. District Judge Kenneth Hoyt, who accepted the guilty plea, handed Wild an 87-month sentence to be followed by three years of supervised release. He was further ordered to pay $$9,302,667.29 in restitution. As part of his plea agreement, Wild agreed to forfeit his home and all of its contents, his vehicles, his 401K pension plan with Memorial Hermann and any other financial assets in his possession in order to pay that restitution to Memorial Hermann. In handing down the sentence, Judge Hoyt noted the significance of the case because it involved public money. Judge Hoyt commented that Wild "victimized Memorial Hermann, it's patients, your family and yourself. You only came to your senses after you got caught and now you will have a significant amount of time to reflect on your actions.”

On or about Feb. 23, 2001, Wild was appointed as manager of Printing and Mail Services, a division within Memorial Hermann which oversees and outsources the creation of all informational and promotional materials disseminated by Memorial Hermann. In this role, Wild had the responsibility for approving invoices submitted for printing services utilized by Memorial Hermann and for forwarding those invoices to accounts payable for payments to be remitted via checks delivered by U.S. mail.  

On or about March 8, 2001, just two weeks after Wild’s promotion to management, an entity named Digital Designs Limited began submitting invoices to Memorial Hermann for printing and data conversion services purportedly provided to Memorial Hermann. Wild used his position to cause the Digital Designs invoices to be approved. Over the span of 14 years, from March 2001 through March 2015, Wild submitted 229 invoices totaling $9,302,667.29 in the name of Digital Designs for services that were never provided to Memorial Hermann.

On March 11, 2015, Memorial Hermann’s chief audit and compliance officer received an anonymous, hand-written letter alleging the Digital Designs account was an anomalous, ghost account and asking for an investigation. As a result, Memorial Hermann swiftly conducted a preliminary review of the account and immediately reached out to law enforcement to report the incident.  

The investigation revealed that the address listed for Digital Designs was a P.O. Box opened by Wild in 1996. In October 2001, Wild had obtained an assumed name certificate from the Harris County Clerk’s Office for “Digital Designs of Texas, P.O. Box 36345, Houston, TX 77236.” The investigation further revealed that payments remitted to Digital Designs were deposited into a bank account which was assigned to Wild with a dba of Digital Designs.  Wild deposited the checks from Memorial Hermann into that account and then transferred those funds to other accounts he controlled. He then used the funds to support his extravagant lifestyle which included, among other things, making significant personal expenditures, purchasing a home and making substantial improvements and extensive international travel for himself and his family and friends.

He has been in custody since his arrest on March 21, 2015, where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The charges are the result of an investigation by U.S. Postal Inspection Service. Assistant U.S. Attorney Jason Varnado is prosecuting the case.