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Audit accuses Wisconsin foster care agency of fraud

The child foster care system plays a vital role in the state of Wisconsin. It's responsible for managing the welfare of thousands of children who have lost their parents or cannot live with them for various reasons. Like many other social service agencies, foster care firms often struggle to provide adequate means for their clients to succeed in life, in part because they rely on public funds that can shrink as state and county budgets do.

So when a foster care agency is accused of stealing the funds it receives from taxpayers, there is considerable outrage on both sides. If an agency is found guilty of such fraud, its leaders can suffer serious criminal penalties. But it takes a thorough investigation to discover and prosecute this type of offense, due to the complexities of such a widespread social service. Those accused of it must be certain that the investigation was done properly to avoid a false conviction.

A couple that runs a Dane County foster care firm is denying that they fraudulently charged taxpayers millions of dollars and used them for the couple's personal benefit. A state audit of foster care agencies across Wisconsin found that the husband and wife acquired more than $6 million in false charges and profits that should have gone to support the children and foster families their agency is intended to serve. The audit took place over two years, from 2009 to 2011. After the audit was released the couple's licenses were revoked, preventing them from continuing to do business. State senators have also called for a formal criminal case against the couple.

The findings of the audit allege that they couple used the extra money they billed -- about $1 out of every $3, for a total of 34 percent of the $18 million it received -- to pay for luxury cars, trips around the country and home mortgages and renovations. They also received salaries of more than $1 million over the course of three years.

But the couple denies the allegations, saying that given the demands of their 24-hour, seven-day workweek, their salaries are relatively low - possibly too low. They've filed an appeal of the revocation of their licenses and if a criminal investigation follows, they're likely to fight back aggressively in court. If they do, they'll need an aggressive attorney who focuses on the defense of fraud and other complex white collar crimes.

Source: Milwaukee Journal Sentinel, "Audit: Foster care firm made $6.1 million in fraudulent or improper charges," Jason Stein, Feb. 6, 2013

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