Ex-Children's Hospital counsel Hairston charged with fraud

Roosevelt Hairston Jr., who was fired in February for allegedly embezzling $1.7 million from Children's Hospital of Philadelphia, was charged Thursday with mail fraud, money laundering, and filing a false tax return to try to hide the theft, the U.S. Attorney's Office announced.

Hairston, 45, who lives with his wife and four daughters in a 7,000-square-foot home in Malvern, held various senior positions at Children's before becoming the hospital's general counsel a little more than a year ago.

His lawyer, Howard Bruce Klein of Philadelphia, said that a guilty plea would soon be entered.

"Undoubtedly, Roosevelt made huge mistakes in his life," Klein said Thursday. "He readily admitted these when confronted by investigators from Kroll," a company hired by Children's to conduct a probe.

The federal charges, filed in a "criminal information" in U.S. District Court in Philadelphia, allege that Hairston submitted dozens of false invoices from shell companies that he created to steal from Children's.

Between December 1999 and December 2003, when Hairston was responsible for coordinating the hospital's legal defense against medical-malpractice claims, he allegedly submitted invoices for expert witnesses that did not exist or had not provided services.

In June 2007, when Hairston oversaw community and government relations for Children's, he allegedly resumed the fraud, submitting bogus claims for various consulting companies.

At times, hospital personnel questioned Hairston about information or errors in the invoices. To fool his coworkers - including his personal assistant - Hairston allegedly went so far as to steal the identity of a longtime friend and create bogus e-mail accounts in the friend's name.

To "launder the proceeds," the charges allege, Hairston opened bank accounts and established phony offices in the shell companies' names.

"Hairston used the funds he stole from CHOP to live a lavish lifestyle, purchasing luxury items, like real estate, a luxury yacht with a captain to maintain the yacht, high-end automobiles, and many other luxury items," U.S. Attorney Zane David Memeger said in a news release.

The government is seeking the forfeiture of any property derived from the alleged theft up to - "but not limited to" - $1.7 million. If that property cannot be recovered, the government will "seek forfeiture of any other property of the defendant's" up to the value of the theft.

Hairston graduated from Temple University's law school in 1990 and worked for prominent Philadelphia law firms before joining Children's in 1997. In 2009, his compensation from the hospital was $727,130, a 15 percent increase over 2008, records show.

Hairston was also involved with many community organizations, nonprofits, and advisory boards, including Arthur Ashe Youth Tennis, the Red Cross of Southeastern Pennsylvania, and the Public Interest Law Center of Philadelphia.

Klein urged that Hairston not be "judged by one series of bad acts alone."

"There is a whole other side to him that should be known," Klein said. "In addition to being a devoted husband and father, Roosevelt is the most committed community servant and activist I have ever seen for a private citizen. We hope that justice is tempered with mercy in the ultimate judicial resolution of this matter."