FBI moves to seize bank deposits in alleged $10 million fraud of Kansas foster care provider
TOPEKA — Federal prosecutors acting on disclosures of a whistleblower moved to seize $700,000 in a civil asset forfeiture case alleging a former information technology employee defrauded Saint Francis Ministries of millions of dollars while the nonprofit was under contract with the state of Kansas to provide foster care and adoption services.
Federal court documents allege William Whymark, owner of WMK Research, ripped off Saint Francis Ministries from January 2018 to July 2021 by exaggerating IT work performed and expenses incurred on behalf of Saint Francis Ministries. The scam purportedly involved fraudulent invoices submitted to the nonprofit organization serving Kansas families in about half the state, court records show.
The legal action targeted cash held in three bank accounts controlled by Whymark, who has an opportunity to challenge the seizure in U.S. District Court. The seizure process was initiated with consent of Judge Eric Melgren of the U.S. District Court in Wichita.
A Federal Bureau of Investigation agent said in court filings there was probable cause to believe Whymark, president of WMK Research of Mount Kisco, New York, engaged in a multiyear scheme netting $10.73 million from Saint Francis Ministries.
The FBI inquiry revealed discrepancies between Whymark’s billing of Saint Francis Ministries, or SFM, and documents from two companies, Pinnacle Seven Technologies and QubeRoot Analytics, that were IT subcontractors hired by Whymark.
“Whymark received these funds through the submission of false and fraudulent invoices to SFM,” FBI agent Kevin Mills said in an affidavit supporting the seizure claim. “Whymark’s scheme to defraud included the submission of fraudulent invoices claiming that personnel had performed work for SFM, when according to QubeRoot and Pinnacle records, they did not.”
For example, the affidavit said, QubeRoot billed Whymark $1.1 million from 2018 to 2021. Whymark allegedly ballooned that billing to $3.7 million when submitting claims to Saint Francis Ministries. In 2018, Pinnacle billed Whymark for $245,000 in IT work. Whymark reportedly inflated that to $1.2 million when submitting claims to Saint Francis Ministries.
Former Saint Francis Ministries chief executive officer Robert Smith hired Whymark in 2018 under a contract paying $164,000 annually in addition to 10% of any IT cost efficiencies achieved. The federal investigation indicated Smith was responsible for approving Whymark’s invoices.
The civil action filed last week sought seizure of $700,000 in New Jersey and South Dakota bank accounts. The accounts were held by Jessica and William Whymark and William Whymark’s company.
Cash from the Saint Francis Ministries scheme was traced by the FBI to bank accounts controlled by the Whymarks and acquisition of a $3.75 million home near New York City. Movement of $2 million tied to the Kansas scheme was transferred in 2021 by Whymark in what could amount to wire fraud, the FBI said.
During the period covered by the investigation, Saint Francis Ministries provided adoption, foster care, family preservation and behavioral health services under contract with the Kansas Department of Children and Families. DCF’s $71.5 million contract with Saint Francis Ministries expires in June 2023.
Saint Francis Ministries, based in Salina, contracted to deliver adoption and foster care services in other states. In 2021, Saint Francis Ministries used $10 million earned from work in Kansas to cover losses on a contract with Nebraska. Nebraska officials agreed to send the $10 million back to Kansas.
The chairman of Saint Francis Ministries’ board of directors said the board learned of the contract with Whymark after allegations surfaced through a “whistleblower” complaint. In 2020, Saint Francis Ministries avoided insolvency as Smith and chief operating officer Tom Blythe allegedly misled the board about investments in technology and agriculture. Smith and Blythe left the organization in November 2020.