If you have kept up on news related articles over the last couple years, this hospital chain has had nothing short of a “soap opera” of events. Now with the involvement of the SEC things are getting a bit more complicated with the investigation of where the funds were potentially diverted. IHHI reported to the SEC that Medical Capital was holding onto $12.7 million more than its contract allowed.
Lack of disbursement of funds to the hospital chain put a strain on receivables although they continue to operate without affecting patient care the article states. In the world of finance today we keep hearing stories of such, even with reinsurers too, and the big question is being asked in many circles, “are the funds there” or maybe this could be changed to “show me the money”. It puts a potential loss of physicians and vendors for the hospital chain down the road if financial obligations are not honored. BD
The legal and financial woes of a Tustin medical lender could spread to four central Orange County hospitals.
Medical Capital Holdings – which a federal judge shut down Monday – defaulted earlier this year on $12.7 million in financing to Santa Ana-based Integrated Health Care Holdings Inc.
That loss threatens the future of IHHI, operator of Western Medical Center-Santa Ana and three other hospitals.
"Medical Capital's nonperformance is a huge issue," IHHI attorney David Robinson said Monday. "For the time being, things seem to have stabilized, but the company is very concerned."
The SEC sued Medical Capital and top officers Sidney M. Field and Joseph J. "Joey" Lampariello last month, alleging they defrauded investors. The SEC claimed they wrongfully diverted $18.5 million of investors' money and failed to tell investors about several defaults.
U.S. District Judge David O. Carter on Monday ordered the company to stop selling investments, froze its assets and installed a receiver to take charge of the books.
Lender crisis puts four O.C. hospitals at risk | medical, ihhi, capital, hospitals, investors - News - OCRegister.com
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