A former Washington County Ambulance District employee has been sentenced to three months in federal prison.
Former Washington County Ambulance District Administrator William “Mal” Gum, 59, and employee, Charlena “Charli” Gum, 44, both of Potosi, were indicted in U.S. District Court in St. Louis in December 2017 for access device fraud, conspiracy to commit access device fraud and federal program theft. Mal Gum was also indicted on four more counts of federal program theft.
On Tuesday afternoon, Charli Gum was sentenced to three months in federal prison for access device fraud. Upon her release, she will be placed on supervised release for three years. As part of the plea agreement, Charli Gum and her husband Mal Gum must pay restitution of about $15,000. She was imposed a fine of $1,000.
On Nov. 5, Mal Gum accepted a plea agreement in federal court to four charges of federal program theft. His sentencing is set for Jan. 28 and he could face imprisonment of up to 10 years for each count and a fine of up to $250,000. He also agreed to a money judgment of $95,000 and restitution to the ambulance district.
On Nov. 9, the Potosi Board of Aldermen voted to terminate Mal Gum's employment with the Potosi Police Department where he had held the rank of captain. The board stated Mal Gum was placed on administrative leave without pay during the investigation. According to a press release from the city, he was officially terminated "due to his admission of guilt regarding scandalous and disgraceful conduct involving felonies which brought the city into public disrepute."
According to the indictment, the ambulance district maintained three bank accounts at Belgrade State Bank - a checking account, a money market account and a building fund. The district also participated in the Medicare program and received more than $10,000 in Medicare funds. Those funds were deposited into the district's money market account.
Up until early 2015, a Walmart Community Card was available for purchases related to district business. A Capitol One card was also available for purchases related to district business. The charges for both were paid by check from the ambulance district's checking account.
Mal Gum was employed by the Washington County Ambulance District Board of Directors as administrator of the district. His wife, Charli, was also an employee.
His salary was set by the board and he authorized his own raises during his course of his time as administrator. His position did not allow for overtime and he was not authorized for overtime pay. As administrator he was responsible for payroll and withholdings of all of the district employees, including himself.
Beginning around Jan. 1, 2007 and each year following, he reportedly paid himself a salary greater than what was authorized by the board of directors. As a result, the district also paid additional benefits on his behalf in the form of Federal Insurance Contributions Act and Medicare.
The district used Anthem Health Insurance up until Dec. 31, 2016 and paid for the employees' health insurance, but did not cover insurance for dependents.
As administrator, he was responsible for deducting the appropriate amount from each employee’s paycheck, including his own, to cover dependent health care costs.
According to documents, he did not have the full amount of the dependent premium deducted from his paychecks, and between 2012 and 2016 the district paid more than $20,000 in health care premiums for his dependents.
Also, according to the investigation, beginning around Jan. 1, 2012, he made personal purchases using the district’s Walmart card and the Capitol One credit card and paid the bills from the district bank account. Also, at various times through Charli Gum's employment with the district, she made personal purchases using the district’s Walmart card.
As a result, he paid those bills with the district checking account, knowing his wife made the purchases fraudulently. The Walmart card statements showed a detailed list of what was purchased during each billing period.
Mal Gum received those credit card bills and routinely paid them from the district’s bank account, knowing that both he and his wife and others made significant personal purchases on the credit cards.
Between Sept. 2, 2014 and Nov. 29, 2014, Mal and Charli Gum made unauthorized purchases of more than $5,000 worth of merchandise and gift cards from Walmart using the district's credit card. Mal Gum then wrote checks from the district bank account to pay for those purchases.
Court documents show that on Sept. 22, 2014, he purchased a $50 American Express gift card and two $100 American Express gift cards. On Nov. 5, 2014 he purchased a Journey CD, a Def Leppard CD and a $25 iTunes card.
Documents show that between Sept. 13 and Nov. 29, 2014, Charli Gum made purchases including $1,990 worth of Mastercard, American Express, Walmart and iTunes gift cards. She also used the district card to purchase lace thong underwear, a bra, a knit top and groceries.
There was also another purchase for hairspray, more underwear and clothing. There were also two occasions where a district employee purchased gift cards adding up to $200.