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Thursday, July 31, 2014

Daycare operators indicted on fraud

Thursday, August 7, 2008

Four family members involved in the ownership and operation of 10 daycare centers in southern Missouri, including one in Monett, were indicted by a federal grand jury on fraud charges. The family allegedly submitted false documentation to receive nearly $123,000 in reimbursements for federally funded programs.

Suzanne Smith, 57, and Stephen R. Smith, 57, who are married, and their daughters, Stephanie Smith, 30, and Christina Ann Thomas, 32, all of Bruner, were charged with one count of conspiracy to submit false documentation and one count of federal program fraud.

Stephen Smith served as the president and Suzanne Smith as vice president of First Steps Daycare, Inc., d/b/a First Steps of Southwest Missouri, Inc. Stephanie Smith was a director and Christina Ann Thomas was the secretary of the corporation, which owned and operated 10 child daycare centers in Missouri, including sites in Springfield, Nixa, Mt. Vernon, Monett, Aurora and Branson.

The indictment, which was handed down by a Kansas City federal grand jury on Aug. 5, alleges that each of the four co-defendants participated in a conspiracy to alter meal and daycare records and to inflate meal counts, thereby claiming meals and childcare costs that were never provided by First Steps from Nov. 1, 2003, to Oct. 31, 2004.

According to the indictment, children who attended First Steps daycare centers qualified for subsidies through the Missouri Department of Health and Human Services, which administered the Child Care Subsidy Program funded by the U.S. Department of Health and Human Services. They also qualified for subsidies through the Missouri Division of Health and Senior Services, which administered the Child and Adult Care Food Program funded by the U.S. Department of Agriculture.

From 2002 through 2005, First Steps officers and employees allegedly perpetuated a fraudulent scheme whereby attendance sheets were altered and meal reimbursement requests were completed for children who did not attend the daycare facilities.

First Steps allegedly submitted 194 daycare claim forms and received $117,622 in reimbursements from the subsidy program, for children who were not present. First Steps also allegedly submitted 70 meal claim forms and received $5,364 in meal reimbursements for children who were not present when meals were provided.

The U.S. Attorney's Office is also asking that the defendants be required to forfeit any property used to commit the alleged offenses or any property that was derived from the proceeds of the alleged offenses. Specifically, this property forfeiture would include monetary reimbursement received through fraudulent means as well as the former First Steps Learn & Grow property in Mt. Vernon and the former First Steps Smart Start property in Monett.

This case is being prosecuted by Assistant U.S. Attorney Jane Pansing Brown. It was investigated by the U.S. Department of Agriculture, the U.S. Department of Health and Human Services, the Missouri Department of Health and Senior Services and the Missouri Department of Health and Human Services.



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