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Use of hospital funds argued

Foundation board member calls for investigation of Adventist after dissolution of body and retention of funds.

November 20, 2008|By Barbara Diamond

A member of the defunct South Coast Medical Center Foundation Board of Directors has accused Adventist Health of pillaging foundation funds and is calling for an investigation.

Member Susan D. Morrison, of Dana Point, has asked an intermediary to contact the state attorney general’s office to review all Adventist Health practices, including the alleged taking of foundation assets and the transfer of donations restricted for specific uses to unrestricted status without the permission of the donors.

“My gift of stock of $10,000 for the linear accelerator was restricted, but that hasn’t stopped Adventist Health from reclassifying it as unrestricted,” Morrison said Wednesday.

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Adventist Health spokeswoman Alicia Gonzalez denied any wrongdoing by the Roseville-based health system, which put the center on the market this summer for the third time in five years.

“We are surprised by all of this because the closing of the foundation was simply a necessary and ordinary part of the sale process,” Gonzalez said Wednesday.

Adventist is in the process of selling the facility to St. Joseph Health System. (See related story on this page.)

Foundation dissolved

Adventist Health officials dissolved the foundation at a meeting at 7:30 a.m. Nov. 14 and presented documents, Morrison said, that authorized Adventist’s takeover of foundation assets, including the Medical Center West office building and the adjacent parking lot on one of the four separate parcels that make up the medical center campus.

“The foundation bought the medical building in 2002 with a down payment of $1.9 million that was restricted for a cancer center, with the understanding the building would be used for a cancer center,” Morrison said.

“We were notified at the meeting that the SCMC Governing Board had signed an agreement with Adventist Health 10 years ago that if after seven years [of ownership] Adventist was losing money, it could be recovered from the foundation,” Morrison said.

“I never would have joined the foundation if I knew [Adventist] could sweep the funds.”

Withdrawing gift

Morrison advised center officials Saturday that she was withdrawing her estate gift and is disputing all donations totaling $35,000 with Chase Visa.

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