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NJ ex-hospital counsel cites fears of fraud

The Record, September 15, 2011

The attorney for Hoboken University Hospital says he resigned in July because he feared the city was committing fraud by engineering the bankruptcy of its hospital, court documents show. Donald Scarinci was the general counsel for the hospital and its board from 2009 until July 16, about two weeks before the facility filed for bankruptcy. In court papers, Scarinci says the city-backed authority created to oversee the hospital withheld millions in contractual payments to help make it appear the facility was in duress and push it into bankruptcy. The authority wants to sell the hospital to private investors. "I was the firsthand witness to a pattern of conduct by the Hoboken Municipal Hospital Authority board members to intimidate, threaten, control, abuse and attempt to force the CEO of [the hospital] and members of the board to take actions adverse to its charter and otherwise violate the laws of the state of New Jersey," Scarinci said in a document filed Wednesday. Hospital authority attorney Ken Rosen said he would not "respond to hysterical allegations that have no basis in fact."