A former executive with a nursing home company based in Roanoke, Virginina has been sentenced to just over five years in prison after pleading guilty to multiple counts involving mail fraud and tax evasion. He was accused of receiving more than half a million dollars in kickbacks from contractors, awarding contracts based on payments rather than on bids, and falsifying tax returns in order to conceal such income. Four contractors have also faced prosecution for payment of kickbacks. The case is important to advocates for victims of nursing home abuse and negligence because of the importance of maintaining adequate facilities for the care of nursing home residents. Kickbacks and other forms of corruption compromise the ability of nursing home administrators to effectively care for their patients.
Roanoke-based Medical Facilities of America (MFA) operates over forty nursing homes located around North Carolina and Virginia. John D. Henderson worked for MFA as its director of maintenance and renovations. According to prosecutors, he demanded and received $541,821 in kickbacks from three or more companies between 1998 and 2006. Those companies then received more than $5 million in contracts from MFA for construction work at its facilities. Henderson allegedly created false records of higher bids from competitors to create the appearance of a competitive bidding process. He was also accused of filing fraudulent tax returns to conceal over $400,000 in income. MFA fired Henderson in 2006 after learning about the kickback scheme.