CLEVELAND — More than three months have passed since MetroHealth CEO Akram Boutros was fired amid accusations of misappropriation of funds.
On Friday, MetroHealth released details of an independent audit, which they say “confirms and expands upon previous findings” that Boutros “circumvented rules and processes to pay himself $1.9 million in unauthorized bonuses and took deliberate steps to conceal his actions from the Board of Trustees and other parties.”
MetroHealth says the law firm that conducted the initial investigation that resulted in Boutros’ dismissal “retained the national accounting firm BDO to perform a thorough review of the policies, practices and issues of the former CEO’s actions.”
They said these findings include:
- Dr. Boutros included himself as an eligible employee in the supplemental bonus pool without Board approval. The Board has sole authority to evaluate and approve bonuses for the CEO.
- Dr. Boutros performed self-evaluations of his achievements and calculated his own supplemental bonus payouts.
- On multiple occasions, Dr. Boutros failed to disclose his supplemental bonuses to the Board, compensation consultants and other parties.
Shortly after MetroHealth released details of the independent audit, Jason Bristol of Cohen Rosenthal & Kramer LLP released the following statement on behalf of Boutros:
"BDO was hired by the Tucker-Ellis law firm, the same law firm that that produced the biased and incomplete initial report. There is nothing independent about this audit report. The report continues to deny allegations that we could definitively prove to be true today: The MetroHealth Board of Trustees approved the bonus program. They knew the CEO was included in the program. They approved the bonus payments for all eligible employees every year. The bonuses were awarded only after a robust assessment.
"The BDO report does however highlight that the Board on multiple occasions fully delegated authority of salary, and wages for all employees to Dr. Boutros and that Dr. Boutros’s bonus payments were made only after board approval of the bonus amounts for all eligible employees.
"At the end of the day, the Board falling down on the job and supposedly not knowing about a bonus program for 200 leaders over five years does not equal concealment. The Board’s continued response is an unparalleled admission of Board malfeasance."
Boutros, who was set to retire at the end of last year, is suing.
"I am utterly flabbergasted by what they're saying," Boutros told 3News’ Monica Robins in a November interview. "They're telling me that the board doesn't know anything about its own [bonus] program and that they approved these resolutions not knowing what they contained. What I'm told is that this is going to really look bad for me and for them, from an oversight perspective."
You can watch that interview in the video below:
MetroHealth said based on the results of their investigation and independent audit, the Board of Trustees “are taking steps to strengthen policies and processes and improve organizational oversight.”
They said the following steps have already been taken:
- The MetroHealth CEO’s annual PBVC compensation (or any bonus compensation) must now be the subject of a separate Board of Trustees resolution and will be audited to assure compliance with all MetroHealth compensation policies and requirements.
- Compensation consultants, who have been hired by MetroHealth in the past to advise on rates of pay at peer health systems and compensation trends, must now verify details of the CEO’s pay and benefits with MetroHealth Human Resources, rather than relying on data provided by the CEO alone.
- The Board will receive actual payroll data for all senior executives at least once annually.
- The Board has created a stand-alone compensation committee to manage all policies and procedures related to executive pay.
- MetroHealth is conducting a national search for a Chief People Officer whose duties will include supervising Human Resources and providing regular updates to the Board. MetroHealth has issued an RFP for a compensation consultant and is in the process of negotiating an agreement with a compensation consultant.
MetroHealth added that the Board of Trustees will consider additional recommendations included in the audit during its next meeting.
Editor's note: Video in the player at the top of this story was originally published on Feb. 17, 2023.