Scandal Tracker 2024: adding Evergreen Recovery

We add another item to the ever-growing list of scandals involving state welfare programs.

KARE-11 TV has been on top of the saga involving Evergreen Recovery, Inc., a drug- and alcohol-treatment facility and related businesses located on Energy Park Drive in St. Paul.

On Wednesday, the Feds unsealed a civil case against Evergreen, four related businesses, and three individuals. You can read the 21-page FBI affidavit at the bottom of this KARE-11 piece.

The Department of Justice accuses the Evergreen group of fraud in an amount exceeding $28 million (p. 21, paragraph 69). So, we are using that dollar amount to update our Scandal Tracker spreadsheet:

The lawsuit filed is a civil matter, but the FBI refers (p. 3, paragraph 7) to an ongoing criminal investigation.

The FBI accuses Evergreen’s owners of spending ill-gotten money on the usual luxuries (multiple homes, BMW, Cadillac, Mercedes, Louis Vuitton, private jet trips to Las Vegas and the Hamptons), while failing to pay their employees.

The alleged fraud involves overbilling the state Medical Assistance and the Federal Medicaid programs for the wide range of services the related companies provided (or didn’t provide) to their in-residence clientele, which appears to consist mainly of the otherwise homeless. The FBI claims that the fraudulent billing dates back as far as 2017 (p. 16, paragraph 53).

The FBI reports that the state Dept. of Human Services (DHS) was scheduled to cut off payments to Evergreen as of Tuesday, July 30.

DHS reports paying Evergreen $343,350 in Fiscal Year 2025, which began July 1. For the previous 12 months (FY24), DHS paid out $5.9 million to the company.

A hearing is scheduled in the civil case in Federal court in Minneapolis for Thursday, August 8.