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Steward Health CEO Resigns Amid Fraud Probes; MPW Implicated in Enron-like Allegations

Oct 9, 2024, 11:57 AM

Steward Health Care CEO Ralph de la Torre is set to resign amid investigations into the company's financial practices and concerns over patient care. The hospital chain, acquired by private equity firm Cerberus, is under scrutiny for awarding multi-million dollar salaries to administrators and paying dividends to executives in stock, while patients allegedly received inadequate care. Investigations by the Wall Street Journal and the Organized Crime and Corruption Reporting Project (OCCRP) suggest that Medical Properties Trust (MPW), Steward's major landlord and financier, may have overpaid for hospitals to boost its earnings and secretly funneled billions in loans to Steward, which reported deep nine-figure losses. MPW CEO Ed Aldag is implicated in orchestrating transactions to mask Steward's insolvency and facilitate Cerberus's exit without risk of a clawback. Aldag reportedly stated, "I am trying different scenarios to get the maximum amount of cash to you guys." Former employees and analysts have compared MPW's activities with Steward to accounting fraud perpetrated by Enron executives.