A top executive of a COVID-19 test kit company, Dennis W. Haggerty, has been sentenced to six years and five months in federal prison for embezzling more than $1.85 million from his employer.
Haggerty, 48, from Burr Ridge, Illinois, misused company funds while working at a Willowbrook, Illinois-based company, according to a statement from the U.S. Attorney’s Office for the Northern District of Illinois.
Fraudulent Payments and Lies
Haggerty, who served as Chief Operating Officer, issued fraudulent payments to himself under the pretense of providing goods and services through his company and a COVID-19 test kit manufacturer. However, prosecutors revealed that these transactions were fake, and the promised goods and services were never delivered. Alongside these fraudulent payments, Haggerty also wrote checks to himself from the company’s bank account.
Between 2021 and 2022, Haggerty siphoned off more than $1.85 million from his employer, committing embezzlement while on pre-trial and pre-sentencing release for an earlier fraud case.
It was later discovered that Haggerty had lied about his educational background and professional credentials to gain access to his company’s finances. He falsely claimed to be a Certified Public Accountant (CPA), according to court documents.
Sentenced to a Second Prison Term
Haggerty’s latest sentence adds to an earlier conviction for another COVID-19-related fraud scheme. He will begin serving the 77-month sentence only after completing a 57-month sentence for a separate crime involving fraudulent sales of personal protective equipment (PPE) at the beginning of the pandemic.
In December 2022, Haggerty was sentenced for his role in defrauding hospitals in Iowa and Illinois through a company he co-founded in March 2020, called At Diagnostics Inc. The company agreed to sell 500,000 N95 masks to a hospital in Iowa for nearly $2.5 million. Instead of delivering the masks, Haggerty directed the hospital’s payment to a personal account he controlled, using the money for luxury cars, paying off $189,000 in credit card debt, and withdrawing over $147,000 in cash.
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When his business partners questioned him about the missing funds, Haggerty altered a bank statement to make it appear that the hospital never made the payment.
In a similar scheme, At Diagnostics agreed to sell one million N95 masks to a hospital in Illinois for $4.5 million. Although the hospital used an escrow account for payment, the company failed to deliver the masks, leading to the money being returned. However, the hospital later mistakenly wired over $933,000 to Haggerty’s account for another order of 500,000 masks that was never fulfilled. Haggerty spent part of this money and never returned any of it.
Restitution Ordered
In addition to his prison sentence, Haggerty has been ordered to pay $1.86 million in restitution to the victims of his fraud. This includes funds embezzled from both his employer and the hospitals he defrauded during the pandemic.
Haggerty’s schemes highlight the extent of his deceit during a critical time, as hospitals scrambled to secure vital protective equipment in the early days of COVID-19. His actions not only betrayed his employer but also undermined trust during a global health crisis.