Ex-CFO faces arrest for embezzlement

SANDPOINT — Bonner General Health's former chief financial officer is being sought for arrest for allegedly embezzling approximately $220,000 from the hospital.

Norilina Harvel is charged with grand theft. Bonner County Prosecutor Louis Marshall said on Wednesday that a warrant has been issued for her arrest.

Harvel left BGH in June 2014 to take at CFO position at Montrose Memorial Hospital in Montrose, Colo. She is no longer employed there, reportedly because of a corporate restructuring.

Harvel, 47, committed the thefts from 2012 to 2014, a criminal complaint alleges.

Ford Elsaesser, chairman of BGH's board of directors, said within a month of her departure, financial discrepancies emerged, prompting the hospital to hire a firm to conduct a forensic audit.

"We believe the total amount of the theft was approximately $225,000," Elsaesser said.

Harvel made unauthorized credit card charges and stole various sums of money that were small enough to avoid detection, according to hospital officials. Harvel also allegedly took out a lease on a piece of surgical instrument sterilization equipment that the hospital never acquired and collected the proceeds.

Harvel somehow managed to set up a bogus BGH checking account at the former Bank of America branch in Sandpoint. She also set up a post office box in the hospital's name to maintain the fictitious lease.

"There was no piece of equipment, but she set up the lease and set up a bank account in which she received the lease proceeds," Elsaesser said.

The lease scheme accounts for an estimated $86,000 of the embezzlement, hospital officials said.

Sheryl Rickard, CEO of BGH, said it's common for hospitals to purchase a costly piece of equipment, immediately sell it to a financing company and then make lease payments. After accepting payment for the equipment, Harvel apparently made payments on the lease.

It appears Harvel attempted to keep the ruse going from afar, but lease-related mail was returned to BGH instead of being forwarded to her new address, Rickard said.

Harvel is reportedly living in Utah. Efforts to reach Harvel were not successful on Wednesday. A message for her left on her husband's mobile phone was not immediately returned.

Hospital officials are at a loss to explain Harvel's alleged betrayal. They were unaware of any personal financial pressures she faced and said that the hospital's finances improved when she was CFO.

Rickard believes Harvel exploited her longevity at BGH and the trust that was placed in her by the hospital and the community at large.

"She used that trust against us. That's the hardest part," said Rickard.

Harvel was employed at BGH for 15 years, 10 of which she served as CFO.

The BGH embezzlement rumor has been circulating for some time, although it was erroneously attributed to Parkwood Business Properties' construction of a new health services facility across the street from the BGH. The hospital leases two of the building's floors.

Rickard and Elsaesser said Harvel's misconduct had nothing to do with the new building.

The thefts are not expected to impact operations at the nonprofit hospital, which officials said had a gross operating revenue of $66 million.

Roughly 25 percent of the loss has been covered by insurance and there is a pending claim that could cover an additional 25 percent, Elsaesser said.

"We're hoping to mitigate close to 40-50 percent of the loss through insurance," Elsaesser said.

Moreover, the embezzlement caused the hospital to strengthen its checks and balances regarding the BGH finances. Hospital officials said the embezzlement escaped notice during rigorous external audits.

It remains unclear how Harvel managed to set up a bogus business checking account, which is no small feat in the Patriot Act era.

Rickard and Elsaesser said the investigation has been lengthy due to the difficulty in obtaining records for Harvel's fraudulent post office box and bank account. Subpoenas for records could not be issued until the criminal action was initiated.

Hospital officials are contemplating civil action against Harvel, but insisted that she be prosecuted criminally.

"This is very serious because she was the CFO and this is basically a charitable institution," Elsaesser said. "She was basically stealing from an institution that has one purpose, which is to provide health care to the community."