Mental Health Official Failed to Reveal Felonies

A Ventura County manager who played a role in last year’s mental health merger debacle is being investigated for failing to reveal multiple felony bank fraud convictions when he was hired three years ago, The Times has learned.

The disclosure of Kevin DeWitt’s criminal past added an embarrassing new chapter to the continuing controversy over management of the mental health department, the subject of numerous state and federal investigations and the center of the biggest financial scandal in county government history.

DeWitt, 39, a former deputy director in the mental health department, acknowledged Monday that he pleaded guilty in 1989 to eight federal charges of falsifying bank records. The convictions stem from fake references that DeWitt entered on loan documents when he worked as a junior loan officer at a Louisville, Ky., bank in the mid-1980s.

The bank lost an estimated $26 million as a result of bad loans processed by DeWitt, according to a 1989 Louisville newspaper article. In Ventura County, government lawyers are looking into DeWitt’s failure to disclose the convictions on a job application and during interviews for his $76,000-a-year mental health department post in 1996.

DeWitt, who now works in the county’s Human Services Agency, said Monday that he failed to check a box on his employment application indicating that he had been convicted of a felony because more than seven years had passed and he believed he was no longer obligated to do so.

DeWitt’s critics say he exhibited poor judgment by failing to disclose his prior criminal history. Chief county administrator Lin Koester said he is “extremely concerned” by DeWitt’s action and has directed County Counsel James McBride to look into the situation.

“Personally, I have no tolerance for withholding of information on employment applications,” Koester said. “But specifically in this matter, we have to wait for personnel staff and county counsel to recommend a proper process and what our alternatives are.”

The disclosure also casts more unfavorable light on the the mental health department, which has been in turmoil as the result of its failed merger in April 1998 with the social services department.

DeWitt supported the merger and served as a “right-hand man” to former mental health director Stephen G. Kaplan in formulating the proposal, sources said. The reorganization was rescinded by the Board of Supervisors after nine months when federal regulators said it violated Medicare billing rules.

However, it spawned a half-dozen investigations by state and federal agents that will cost the county at least $15.3 million in health-care reimbursements.

U.S. attorneys allege that the county fraudulently overbilled Medicare for services by placing doctors’ names on insurance forms for work provided by social workers, nurses and psychologists. Providing a doctor’s name allows for a higher Medicare reimbursement rate.

A Federal Case

The FBI is also conducting a criminal investigation to determine if county officials deliberately broke the law when billing the federal government for the higher rate.

DeWitt’s involvement in the merger, and Monday’s disclosure of his past, casts an “interesting new wrinkle” on the still-unfolding fiasco, said Supervisor Frank Schillo, a persistent merger critic.

DeWitt was ousted earlier this year, along with Kaplan, for his role in the merger. He transferred to the Human Services Agency, where he works as an aide to agency head Barbara Fitzgerald, earning a lower salary of $65,200.

Fitzgerald said she could not comment on the internal investigation because personnel actions are confidential. But she praised DeWitt’s performance as “excellent” since coming to her agency.

DeWitt insists that his past has no significance to the merger’s demise or the ongoing regulatory reviews of mental health billing procedures. His role in the merger’s planning was at the fringes, DeWitt said, and he had virtually no oversight of billings in the mental health department.

The decade-old convictions are an embarrassment that he had hoped would remain in his past, DeWitt said. He attributed his misdeeds to the poor judgment of a 25-year-old trying to impress his bosses in a pressure-filled industry.

“I was literally a young, screwed-up kid trying to do good in his job and not doing it very well,” he said.

*

He charged that information about his past has been made public by merger opponents to smear him and anyone connected with the former administration of the mental health department.

DeWitt is supported by Penny Matthews, a former manager in the mental health department, who said she, too, believes he is being targeted by DeWitt’s former boss, Health Care Agency Director Pierre Durand.

“We are talking about people who have really dedicated themselves to the [mental health] department that Pierre just wants to annihilate and just rub them out any way he can,” Matthews said.

*

Durand declined to comment. But Schillo said it is unfair to point fingers at Durand.

“I’ve said from the beginning that this is not an effort to smear anyone,” he said. “It is an effort to find out exactly what happened and why we got ourselves into this mess so it doesn’t happen again.”

Supervisor Kathy Long said that while she does not approve of lying on employment applications, she is “extremely disgusted” that DeWitt is being publicly vilified. The matter should have remained confidential, Long said.

“At some point, the board has got to get ahold of this and take a leadership role in stopping this character assassination,” she said.

Supervisor John K. Flynn said DeWitt has been a good employee and that he will wait for the internal investigation’s completion before making a judgment. But his initial reaction is that the past felonies should not be a problem if DeWitt has proven he has changed his ways, Flynn said.

“We believe in rehabilitation in this country,” he said. “How do people become rehabilitated if they can’t get a job?”

Supervisor Judy Mikels declined to comment, citing a personnel confidentiality policy. Board Chairwoman Susan Lacey, an architect of the merger and its strongest defender, did not return phone calls.

Hiring Discretion

Disclosure of a felony conviction does not always bar someone from getting county employment, said Human Resources Director Barbara Journet. The county has discretion to weigh the severity of the felony and whether it would be appropriate to hire the person.

“There has to be a direct link between the crime committed and the position that the individual will be hired to fill,” Journet said.

In addition to giving false information about his convictions, documents show DeWitt deleted from an attached resume any reference to his employment at the Kentucky bank where the crimes occurred.

“I just chose not to report the bank” employment, DeWitt said Monday.

DeWitt said he was a loan officer doing commercial construction lending when he filled out the names of false references on bank loans. The customers were never aware of what he did, and he did not personally profit, DeWitt said.

First National Bank of Louisville became aware of his actions when the loans defaulted and they checked the references, DeWitt said. Federal prosecutors initially brought 21 charges of falsifying bank records, but agreed to reduce that to eight counts in return for DeWitt’s guilty plea.

He was placed on five years’ probation and paid a $40,000 fine, DeWitt said. His probation term was later reduced to two years, he said.

DeWitt said he earned a doctoral degree in economics from the University of Kentucky and held a series of jobs in finance and management in the private sector following his convictions.

*

Before coming to Ventura County, he managed a mental health managed care system in Benson, Ariz.

It was his background in business that got him the job, DeWitt said. Durand, a strong proponent of competition, was exploring the possibility of privatizing the county’s mental health clinics and wanted his help, DeWitt said. He was interviewed by Durand and Kaplan.