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Robert Trigaux

Better late than never: WellCare's new execs pursuing claims against former execs

7

December

Toddfahraexwellcareceokenhelle Wake up and good morning. So, the new management at Tampa's WellCare Health Plans Inc. finally decided to go after its predecessors, who defrauded the state and incurred hefty fines. The company said in a federal court filing it would pursue claims against former president and chief executive Todd Farha, chief financial officer Paul Behrens and general counsel Thaddeus Bereday. The three presided before WellCare's offices were raided by several agencies in 2007. The story, first reported by St. Petersburg Timesreporter Kris Hundley, can be found here. (Photo: Todd Farha, shown back in the Wellcare days, by Ken Helle of the St. Petersburg Times.)

WellCare later agreed to repay $35 million it defrauded Florida out of in claims. In May, the company said it would pay another $80 million to resolve health care fraud charges and $10 million to settle a lawsuit from the Securities and Exchange Commission. A few more of those and things might get expensive.

In January 2008, Farha, Behrens and Bereday resigned with Farha saying he was off to pursue "entrepreneurial interests." Under terms of their departures, Farha was divested of more than $10 million in stock awards. Behrens and Bereday also forfeited hundreds of thousands of dollars in salary they would have been paid under other circumstances.

Before the fraud hit the fan, Farha was a high-profile Republican fundraiser. So much so that President Bush in 2006 nominated him to be on the board of the SPIC -- the Securities Investor Protection Corp. Even after the FBI raided Wellcare the next year, Farha remained on the board as vice chairman of the nation's organization whose mission, among other things, is to help protect investors against fraud. How precious is that? Here is his noble testimony, pre-confirmation, in 2006 before the Senate Banking Committee.

The Obama Administration last month nominated a successor to Fahra.

What has Fahra been up to since getting the boot at Wellcare? He's decidedly low profile though he apparently has some business ties to a Tampa company called Bayshore Logistics Inc. and he's obviously bracing for some pending litigation.

-- Robert Trigaux, Times Business Columnist

[Last modified: Tuesday, June 1, 2010 12:26pm]

    

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