Former CFO sues Clinicas over firing, alleged retaliation in whistleblower case
The long-time chief financial officer for Clinicas del Camino Real has filed a whistleblower lawsuit against the nonprofit health system, claiming she was fired for telling her employers they were violating fiscal guidelines in federal contracts.
The lawsuit, filed Sept. 19 in Ventura County Superior Court, alleges Chris Velasco was wrongfully terminated in an act of retaliation and discrimination. It comes on the heels of a federal investigation that concluded her ouster was payback for allegations involving CEO Dr. Gagan Pawar and Board President Chuck Hookstra.
Velasco told the investigators she complained to Pawar and others that the board, as a governing body, did not have the authority to purchase services for Clinicas but did so anyway. She alleged the board didn't put contracts out to bid but instead awarded them to friends and colleagues. She said Pawar signed off on the transactions.
The investigation by the Health and Human Services Office of Inspector General has been submitted to the agency’s leader, Secretary Xavier Becerra, for a final decision. Pawar said the health system was still awaiting that decision.
The CEO said she couldn’t comment on the lawsuit because it's a pending legal matter but earlier offered a denial to similar claims made in the federal investigative report.
"We do not accept any allegations of Clinicas wrongdoing in this report, which has not yet been adopted or acted upon by the agency itself," she wrote in a text.
Allegations against the health system mounted days after the lawsuit was filed when board member Candelaria Franco called for the resignation of Pawar, Hookstra and the Clinicas board's executive committee.
In a letter, Franco alleged the executive committee submitted false information to government agencies and also withheld information from the full board regarding the decision to release former CEO Roberto Juarez two years ago after more than 40 years of service.
Pawar did not respond to Franco’s allegations but said in a statement that Clinicas follows all “applicable laws and regulations.”
Founded more than a half-century ago, the system of clinics received $14.5 million in federal funding last year to provide care to under-served populations. The network sees more than 100,000 patients a year.
Pawar, who had been the system’s medical director, was named acting and then permanent CEO in 2021 after Clinicas directors opted not to renew Juarez's contract.
Velasco, hired in 1985, was a vital player at the system for decades, sometimes serving as interim CEO in Juarez's absence. In the lawsuit, she alleged Pawar was not qualified to serve as CEO and said the board violated its own bylaws in hiring her.
Velasco was fired in September 2021. She said Clinicas leaders knew before they fired her she filed multiple whistleblower complaints with the federal government, detailing her concerns about retaliation and Clinicas' alleged violations.
“Chris did what she needed to do,” said her attorney Laura Horton who specializes in whistleblower cases. “I think the person who blows the whistle, they’re one of the most courageous people around. They are doing what is right and the company is vilifying them for it.”
Velasco, who is 62, alleged her age and Mexican-American ethnicity contributed to her termination and claimed the factors also played a role in Juarez’s removal. She asserted Pawar and others harassed her in the form of bullying and constant criticism, also spreading falsehoods in alleged defamation.
The former chief financial officer is asking for damages and compensation to cover back pay, economic losses, emotional distress, legal fees and other impacts.
Franco, a board member since 2018, called for immediate resignations of Pawar, Hookstra and other leaders in a Sept. 21 letter to the Clinicas board. She alleged the board's executive committee submitted a letter with false information to the U.S. Department of Citizenship and Immigration Services regarding the leadership change from Juarez to Pawar. She also alleged multiple other violations and asserted care at the clinics has deteriorated since Pawar became CEO.
In a phone interview, Franco said she has also made the allegations in a whistleblower complaint filed with the Office of Inspector General.
"I am submitting this letter in fear of retaliation. I fear that I will be removed from the (board of directors) and/or that there will be efforts to intimidate me or something worse," she wrote to the board.
Pawar did not address any specific claims. She praised the system's care, cited its growth and offered a blanket denial.
“We have an unwavering commitment to ensure all our actions continue to be in full compliance with all the applicable laws and regulations governing our industry," she said.
Tom Kisken covers health care and other news for the Ventura County Star. Reach him at tom.kisken@vcstar.com or 805-437-0255.
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This article originally appeared on Ventura County Star: Ex-CFO sues Clinicas over firing; alleges discrimination, retaliation
