The Cayman Islands Health Services Authority is bracing for another criminal investigation following the conviction of former board chairman Canover Watson on five corruption-related charges connected to the CarePay patient swipe-card contract fraud.
This ongoing investigation, HSA Chief Executive Officer Lizzette Yearwood said, prevents the authority from disclosing details of any contract or contracts former health services information technology chief Dale Sanders maintained with the Cayman Islands government.
The Cayman Compass has requested copies of all government contracts previously or currently held by Mr. Sanders since Jan. 1, 2011.
“I … must deny release of these documents based on the fact that another criminal suit is expected to follow closure of the previous one,” Ms. Yearwood said in a Feb. 11 letter to the Compass. Section 16 of the Cayman Islands Anti-Corruption Law prevents disclosure of a record if it could affect the conduct of a prosecution or a criminal trial.
Questions sent to the Anti-Corruption Commission last week regarding the ongoing criminal investigation into CarePay-related matters received no response. However, the Compass was aware that investigators with the Royal Cayman Islands Police Anti-Corruption Unit continued to review computer files provided to officers in January by employees at Maitland, which acquired Watson’s firm Admiral Administration, in November 2012.
Those computer “flash drive” files – taken from detachable USB memory cards left in Watson’s office following his August 2014 arrest – have revealed a number of details regarding the CarePay scheme including Watson’s plans to route profits from the fraud to a shell company owned by him and business partner Jeffrey Webb, known as The W Group.
The flash drives also contain details of a number of other business ventures the two men and other individuals who were or are currently members of the Cayman Islands Football Association had embarked upon. One such venture included the failed bid to set up a SuperMed Pharmacy in the Cayman Islands; another involved the opening of a petrol station in Red Bay for which Webb had apparently reimbursed Watson.
According to information revealed at Watson’s trial, Mr. Sanders’s involvement in the CarePay probe was central because he appeared to be the first Cayman Islands government official to raise concerns regarding what he suspected to be corruption in connection with the award of the five-year, US$13 million deal. Watson was convicted at trial of directing that contract to a local company, Advanced Integrated Systems Cayman Ltd., which prosecutors said he and Webb ran behind the scenes.
In July 2011, following the failure of the first attempt to implement the CarePay swipe-card system at the Cayman Islands Hospital, Mr. Sanders said he sent an email to friends and family members in the U.S. remarking that he believed government ministers were behind Watson’s back-room dealings.
“Mr. Watson continued to invoke the interest of the premier and [health] minister in this project,” Mr. Sanders testified in December. “We had to have something by July 1  … so that they could declare a political victory.”
It was in September 2011 that Mr. Sanders disclosed his concerns about CarePay and AIS to Nancy Kirkconnell-Ewing, who had an interest in another company – Brac Informatics – that had wanted to bid for the hospital contract, but bowed out at the last minute, telling Watson they believed the bid process was rigged.
During the 2011 visit to Cayman Brac, Mr. Sanders made “confidential allegations” to Moses Kirkconnell, Mrs. Kirkconnell-Ewing’s brother, about what he believed to be corruption in the hospital contract agreement. Individuals mentioned included Watson, former Health Minister Mark Scotland and former Premier McKeeva Bush.
Watson’s attorney, Trevor Burke, QC, asked Mr. Sanders what right he had to mention Mr. Scotland or Mr. Bush’s name in connection with the CarePay deal. Mr. Sanders responded that he had no specific evidence, but got the impression that Watson would not have been directing the CarePay contract bid process in such a way unless he had government’s approval to do so.
Mr. Burke suggested that then-Minister Scotland certainly supported the CarePay project, but that didn’t mean he was involved in anything illegal. Mr. Sanders acceded the point and noted that up until that stage, he thought Mr. Scotland was an honorable man.
In the summer 2013, following the election of the Progressives-led government in the Cayman Islands, Mr. Sanders went to Washington, D.C. for a conference and there met two ministers of the new government, Mr. Kirkconnell and then-Health Minister Osbourne Bodden.
Mr. Sanders said the two ministers wanted to discuss the CarePay contract situation and that Mr. Bodden wanted to talk about the development of government’s new strategic healthcare plan.
“Did the deputy premier [referring to Mr. Kirkconnell] promise you a … consultancy agreement if you helped them?” Mr. Burke asked, referring to the CarePay investigation that was under way at that time.
Mr. Sanders replied, “No, and I was not interested in that. Now, advising Minister Bodden on his strategic plan [for healthcare], I would be interested in that.”
During Watson’s trial, Mr. Sanders said he could not recall or could not provide the details of any payments he had received since his first employment contract with the Health Services Authority had ended in 2012. It is those contract details the Compass sought to obtain in its open records request to the Health Services Authority.
The IT consultant’s contract with the HSA in its final year was worth approximately $10,000 per month between 2011 and 2012.
Mr. Sanders testified that while this amount might seem like a large paycheck to some, his annual income in the U.S. healthcare industry was typically about US$1 million per year, and indicated that he didn’t really need a Cayman Islands government contract.
“Well, lucky you,” Mr. Burke remarked.