Former CHOP exec pleads guilty in $1.7 million embezzlement scheme

A former Children’s Hospital of Philadelphia executive pleaded guilty Wednesday to mail fraud, money laundering and filing a false tax return.

CHOP’s former general counsel Roosevelt Hairston,46, faces five to seven years in prison for embezzling $1.7 million dollars from the hospital. He set up fake companies complete with P.O. boxes, bank accounts and e-mail addresses, then invoiced the hospital for services these shell companies never rendered.

“This was a very large embezzlement going over a number of years,” said Assistant U.S. Attorney Paul Gray. “It was particularly complicated, and Mr. Hairston created a number of entirely fictitious entities and had checks mailed to them over a period of years without detection, so it’s a very large fraud.”

The U.S. Attorney’s office said Hairston used the funds he stole to live a luxurious lifestyle, buying a yacht and paying a captain to maintain it. At the hearing to enter his client’s plea, Hairston’s lawyer, Howard Bruce Klein, took issue with that.

“We disagree that he was living a lavish lifestyle,” Klein said after Hairston’s court appearance.

At a sentencing hearing in October, Klein plans to emphasize Hairston’s work for numerous charitable organizations in the area.

“To the extent that he had a boat, that was primarily used for entertaining for charitable events, for fundraising, a lot of times for CHOP,” Klein said.

Klein said much of the embezzled money went to pay off two failed real estate investments in Chester County. Hairston is now attempting to sell those properties to pay CHOP back the stolen $1.7 million.

Hairston will also be responsible for up to $1 million in unpaid taxes.