BBH says it has given requested documents to federal investigators

Baltimore Behavioral Health Inc. says it has handed over some documents demanded by the federal government as part of an investigation into alleged shortfalls in the retirement plan at the West Pratt Street mental health clinic.

Employee tax records were provided Monday, the day before a scheduled hearing in federal court on the matter, according to a court filing. The U.S. Labor Department sued BBH and chief executive William "Kris" Hathaway in October, alleging that they had failed to comply with two administrative subpoenas issued in May.

The clinic said Monday in court papers it had turned over employee W-2 forms. It also promised to produce "all remaining documents" sought by subpoena and to continue giving its retirement plan administrator, Lincoln Financial Group, permission to provide documents to the government.

An attorney for the clinic said the dispute over the documents is now resolved. "We settled the matter so no hearing was necessary," Jay Miller wrote in an email. Miller, a BBH board member, did not respond to a request for additional information.

Labor Department spokeswoman Joanna Hawkins declined to comment.

The federal inquiry began last December, about two weeks after The Baltimore Sun reported that two former employees at the nonprofit clinic had discovered unexplained shortfalls in their retirement accounts.

In July, BBH's admissions director sued her employer in federal court, claiming the clinic "diverted and stole" thousands of dollars from employees by failing to deposit payroll deductions in their retirement and disability plans. That case is pending; the clinic hasn't responded, according to court records.

A nonprofit company founded in 1997, BBH has received more than $65 million over the past five years in government payments, largely from billing the Medicaid program for the poor and disabled. It specializes in treating patients with both mental illness and drug addiction.

The clinic was the subject of a Sun investigation last year that revealed unusually high Medicaid billings and detailed the nonprofit organization's control by Hathaway and several family members who earned six-figure salaries.

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