Trustees of the Tulare Local Healthcare District were presented with an apology letter from Alan Germany, the former CFO of Healthcare Conglomerate Associates — the company which managed Tulare Regional Medical Center from 2014 to 2017.
He was ordered by Tulare County Superior Court Judge Michael Sheltzer to write the letter as part of a plea agreement finalized on November 9, and the letter was presented to the board during closed session on Wednesday, November 29.
Germany also paid a court ordered restitution of $100,000 to the Tulare district and $50,000 to the Southern Inyo Healthcare District. Germany served as the Chief Restructuring Officer at the Southern Inyo Hospital, which also had a management agreement with HCCA.
Charges were filed against Germany, HCCA CEO Yorai “Benny” Benzeevi, and attorney Bruce Greene in August of 2020. Germany’s charges including a misdemeanor charge of failing to file Form 700, the financial disclosure required of all public officials, and a more serious felony violation of conflicts of interest in a contract involving his employers.
Germany was facing a maximum of three years in prison.
In his brief letter Germany said, “I apologize for and regret my involvement in the 2016 Line of Credit between Tulare Local Healthcare District and Southern Inyo Healthcare District. I also apologize for and regret my failure to file a Form 700 which would have disclosed my personal financial interests.”
Thank you for the opportunity to have worked with Tulare Local Healthcare District from 2014-2017.
I recall the farmlands of Tulare County and remember the tremendous work ethic of its residents. I strove to emulate that daily as I worked on behalf of the District.
I apologize for and regret my involvement in the 2016 Line of Credit between Tulare Local Healthcare District and Southern Inyo Healthcare District.
I also apologize for and regret my failure to file a Form 700 which would have disclosed my personal financial interests.
I wish Tulare Local Healthcare District the best in the future.
Germany avoids prison time
Germany left HCCA in 2017 and has since moved to Tucson, Ariz. where he found other financial work.
When he was charged in August 2020, he lost that job and has been unemployed since. His hope, according to the hearing, was to avoid jail and get back to work so he could support his family.
During a hearing on October 3, 2023, Germany accepted a deal in which he would plead “no contest” to the crime of conflict of interest, a felony, and a failure to file a statement of economic interest, a misdemeanor.
The maximum prison sentence for the conflict of interest charge is 22 years. Because he pled “no contest” the most time he faced in prison was 3 years.
At the November 9 hearing, Deputy District Attorney Trevor Holly said that it was the district attorney’s office’s position that Germany should serve 365 days in jail.
Holly said, “We wanted a 365-day sentence to show the seriousness of the crime.”
Holly brought up the “position of trust” as another reason for wanting Germany to face jail time.
“Normally, when we have the position of trust factor, it’s usually somebody who was an accountant at a private firm or was a cashier or something of that sort, but here we had someone who was a public official of a taxpayer-owned institution. That is the highest position of trust or one of the highest positions of trust in our society,” said Holly.
“And, again, the punishment needs to fit the crime, the seriousness of the breach of the trust.”
Holly also wanted prison time for Germany to serve as deterrence. “I don’t even know how many boards we have in the county. I suspect it’s over 100. And every single person on the boards and every single person that works those boards has to be careful of conflicts of interest. In Mr. Germany’s case, it wasn’t just that he had a conflict of interest, but, as we pointed out, he sided with the paymaster in the instance offense.”
Germany’s attorney, Kevin Rooney of Fresno’s Hammerschmidt Law Corporation, responded to the issue of deterrence saying, “It’s going to impact him forever. It’s on the Internet. It’s never going away.”
“Nobody wants to be where Mr. Germany is. And Mr. Germany never intended to hurt a district, never intended to abuse anything. He was doing his best in extraordinarily trying circumstances to keep both these problematic health care districts operating,” said Rooney.
Rooney added that Germany had never committed a crime and added, “I don’t think there’s very many human beings who have lived as law-abiding life as he has, let alone very many in front of the Court that have led that kind of law-abiding life.”
During the trial Rooney said that a witness attested Germany’s “tremendous moral character.”
He added that Germany made a huge effort to keep the hospitals, especially Tulare Regional, operating and serving people. Rooney added in so doing Germany delayed his own compensation.
Rooney concluded, “Mr. Germany does not need and it’s not fair and correct to have a custodial part of his sentence.”
“Mr. Germany has admitted the conflict of interest. I’m not trying to run away from it. But the idea that this was corrupt, that it was something like that, it’s just not supported by the evidence, and it’s not right.”
Holly responded, “As I pointed out in the plea, we do concede Mr. Germany was the least culpable person of the trio that have been charged. He didn’t have money directly in his pocket. But the case kind of points out why the conflicts of interest are actually illegal, because the pressure that Mr. Germany faced by having to please the guy who signs his paychecks affected his judgment on how to do these contracts. This was not a good deal for Tulare, and everybody knew that, and they did it anyways.”
At the end of the hearing Judge Sheltzer sentenced Germany to two years probation, 540 hours of community service, a restitution payment of $100,000 to TLHCD and $50,000 to Inyo Hospital District, and ordered Germany to write a letter of apology to the residents of Tulare’s hospital district.
If Germany violates probation he will have to serve six months in prison.
“If you take an otherwise law-abiding citizen who appeared for all other purposes to be a moral, upstanding, productive member of society, to turn around and put him in the Tulare County jail for a year just doesn’t make any sense to me. I’m sorry,” said Judge Sheltzer.
This closes a chapter of TLHCD’s relationship with Germany, but Benzeevi and Greene’s cases are still working their way through the court system. Greene is also facing possible discipline in a separate case before the State Bar Court of California.