Complaint says hospital board members misappropriated millions

BELL COUNTY, Ky. (WYMT) - The Pineville Community Health Center (PCHC) has filed a legal complaint against two members of its board of directors.

On December 1, President and CEO of PCHC Michael Frey and Board Chair Natalie Frey filed a complaint against board members Dennis Varghese and Sheryl Richter for allegedly misappropriating at least $7 million of the hospital’s funds.

The complaint also claims Varghese and Richter refused to provide the financial information needed for the hospital to complete its Medicare reporting. The deadline for Medicare reporting was December 2.

The Frey’s attorneys reached out to the defendants on November 22 demanding they account for and return the funds and provide the information needed for the Medicare report. The defendants’ counsel sent a response on November 27 trying to remove the Frey’s from their respective positions.

The complaint goes on to say the removal is invalid and requests an injunction.

A motion hour was initially scheduled in Bell County Circuit Court for Friday afternoon. That hearing was canceled as the case will move to federal court.

WYMT reached out to the plaintiff’s attorney. He provided this statement:

“We’ve laid out the issues in our complaint, and while we can’t comment further at this time, Michael and Natalie Frey’s goal here is simply to ensure the hospital continues to provide quality care to the community.”

We also reached out to the defense for comment and have not yet heard back.