Systems set up to protect the money of clients at the Hillsborough Association of Retarded Citizens or HARC, all failed. As a result, HARC freely raided a trust account containing clients' money to help the agency fund its everyday expenses and used up to $800,000 without the clients' knowledge or permission.
The clients' money spent by HARC consisted mostly of social security benefits and private donations.
HARC has since gone out of business and the clients' money will probably not be returned.
"This looks like misappropriation and a huge breach of fiduciary duty," Robinson said.
Elder law attorney Charles Robinson says Florida's attorney general needs to take a second look.
In November 2011, former HARC CFO Jane Frank told an investigator with the Attorney General's office that she discovered money was regularly withdrawn from the clients' trust account. Frank said the trust account only had $2500 in it. The account should have contained $380,000.
An 8 On Your Side investigation found clients' money at least partially paid for salaries and expensive perks for former CEO Richard Lilliston and CFO Frank Pannullo.
Among the perks, Lilliston and Pannullo each enjoyed an $1,800 dollar per month car allowance. Neither were authorized by HARC's board of directors.
According to HARC Foundation chair, Steven Brannock, HARC also paid for cell phones for members of Lilliston's family. Another unauthorized expense according to Brannock.
The A-G found no evidence of Medicaid fraud, client abuse, neglect or exploitation. It referred the case to the Florida Department of Financial Services.
Investigators determined the trust's wording allowed HARC to spend the clients' money.
"I don't see that, that's allowed at all. I would sure hope that the Attorney General would take a second look at this," Robinson said.
Robinson, reviewed the wording of the trust for News Channel 8. He found the money was only to be used for the supplemental care and needs of the clients, not to plug holes in HARC's budget.
"If they didn't maintain the trust for the beneficiary then I think there are huge legal questions that are raised that law enforcement, the Attorney General or somebody should really take a much closer look at," Robinson said.
Robinson suggested if the Attorney General is walking away from the case, the Hillsborough County State Attorney may have jurisdiction to investigate and prosecute any wrong doing.
"I think there has to be a very thorough investigation," said Deborah Linton, Executive Director of The Arc of Florida. The Arc of Florida is a statewide organization whose mission is to improve the quality of life for developmentally disabled people. HARC is not a member.
"I've never seen an organization overall take this amount of residents' funds and use it for themselves. It's pretty shocking and we're pretty disturbed about it," Linton said.
Linton points out there are safeguards in place to help prevent individuals or agency's from inappropriately spending clients' money.
She contends this type of massive money transfer should have shown up in HARC's annual audit.
"In the auditor's defense, I suspect that the so-called "pooled trust" just looked like another HARC bank account. It wasn't properly labeled as a trust account so that might well explain why it was overlooked, " Brannock explained in an email.
Linton says monitors with Florida's Agency for Persons with Disabilities, show up monthly in HARC's group homes. One of their responsibilities is to check clients' accounts.
"No one told us there was something fishy going on," APD spokesperson Melanie Etters said. APD monitors do visit HARC's group homes monthly.
"Our goal is to protect the health and safety of people in our care. Our monitors are checking the facility to make sure it is clean, that is has food and that nothing looks out of the ordinary," Etters said. She claims APD had a number of issues with HARC and turned them over to the proper authorities.
Linton says she reviewed a year's worth of APD monitoring reports on HARC and found issues.
"There are about three citations for lack of records or no resident funds available. So what happened when they discovered it on those occasions I don't really know. Did it stop there or did they do a further investigation? I really don't know," she said.
Social security also reviews how clients' money is spent.
"From the CPA, to the monthly monitoring by the agency (APD), to the social security reviews, I want to know why every system that I know that's supposed to be in place to help us prevent this didn't catch it," Linton said.
Linton points out developmentally disabled people living in group homes have little money to begin with.
"To make it okay to take their money, I can't imagine the ramifications. They have very little financial assets and to take that away from them is just unthinkable," she said.
Pannullo acknowledged that if the clients' money went into HARC's operating budget, it is likely that they helped pay for those pricey car allowances.
"I have absolutely no comment about HARC," Lilliston said when contacted by telephone.
Lilliston, a media darling, who wasn't shy about appearing on camera while at HARC, refused to answer his door when 8 On Your Side sought an explanation.
However as we left his Brooksville property, Lilliston tip toed from his house and peaked out from behind a tree.
