Health Care System Execs Arrested By TODD SPANGLER .c The Associated Press PITTSBURGH (AP) - Three former officials of a once-powerful health care system were charged Wednesday for allegedly diverting $52 million in charitable endowments, in part to stave off bankruptcy, authorities said. The criminal charges come after the three were sued by the state last month, along with five former trustees of the nonprofit Allegheny Health, Education and Research Foundation. Allegheny was the state's largest health care system with 14 hospitals and a medical school before bankruptcy proceedings began in 1998. It eventually collapsed and was sold off in pieces. The company's former chief executive, Sharif Abdelhak; chief financial officer, David McConnell; and general counsel, Nancy Wynstra, were indicted by a statewide grand jury on charges of theft and conspiracy, said Attorney General Mike Fisher. They could face more than 10 years in prison if convicted. ``This money wasn't theirs to use as they saw fit,'' Fisher said at a news conference. ``It had been set aside for charitable purposes.'' Abdelhak and McConnell were arraigned Wednesday and Wynstra was expected to surrender on Monday, Fisher said. Their lawyers did not immediately return telephone calls Wednesday. The three are charged with diverting $52 million in charitable endowments in an effort to prop up the ailing medical system, Fisher said. The lawsuit Fisher filed last month alleged that overall, $78.5 million in restricted funds was misused before the bankruptcy. Fisher accused the executives of using the charitable assets to pay operating expenses and possibly to repay an $89 million loan to Mellon Bank and three other lenders. Among the former Allegheny trustees sued were four who had ties to Mellon Bank. Investigators said the three executives received pay raises, bonuses and lavish expense accounts during the time charitable funds were being diverted, between February and July 1998. Abdelhak also was charged with making about $65,000 in illegal campaign contributions to state and federal candidates, including Fisher himself, in 1997 and 1998. The contributions were made in the names of Allegheny employees, which is illegal, Fisher said. Fisher said he's returning the $2,500 he received. No other arrests were expected but the state investigation and investigations by the Securities and Exchange Commission and the Internal Revenue Service continue.
