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Lawmakers: Foster care fraud could be 'tip of iceberg'

Published On: Feb 06 2013 07:45:26 AM CST   Updated On: Feb 06 2013 08:12:10 AM CST
MADISON, Wis. -

Two Republican state lawmakers are calling for a criminal investigation of a Middleton foster care agency accused of misusing nearly $5 million in taxpayer money on lavish lifestyles.

Sen. Leah Vukmir of Wauwatosa and Sen. Rob Cowles of Green Bay have called for the state Department of Justice to investigate Community Care Resources.

"These people thought that there was no accountability, that they could submit bills on all these lavish things and make us as taxpayers pay for it," Cowles said Tuesday. "It's pretty amazing."

Community Care Resources collects state money to place foster children in licensed homes.

The Wisconsin Department of Children and Families has revoked the license of the foster care agency following its own audit that found the agency inflated salaries and spent taxpayer money on luxury cars, personal travel and other inappropriate expenses between 2009 and 2011.

Owner Dan Simon has vigorously denied the allegations.

Cowles said in addition to the criminal investigation he is calling for a full review by the nonpartisan Legislative Audit Bureau. He said, since the recent audit only goes back to 2009, it may only be revealing "the tip of the iceberg."

The complete audit may take months, but the state can make changes while it's going on, Cowles said.

"In the meantime, if the agency knows there's certain things that need to be fixed, we could do it in the budget process or we could do it in separate bills," he said.

The attorney for Community Care Resources said his clients are appealing the state audit and aren't aware of any criminal investigation.

Appealing the state findings means the Middleton business will continue to operate until the appeal is heard by the state Department of Administration's Division of Hearings and Appeals.

Under state law, Community Care Resources has a right to a hearing within 30 days of the hearing request unless it waives that right.

The state said "CCR waived the 30-day limit allowing for an undefined time period in which the appeal will be heard."

David Schwartz, an attorney for the Simons, said Tuesday he is hiring independent accountants to counter the state.

Vukmir said she planned to get the secretary of the state Department of Children and Families in front of a Senate committee to explain how the alleged fraud took so long to uncover.

"Someone had to sign off on some of these (expenses)," Vukmir said. "Even though the audit was triggered by the department, I still have questions on how in the heck some of these things managed to get through."

The Department of Children and Families said foster parents licensed by CCR will receive payments directly from their county rather than from CCR to ensure the payments' integrity.

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