Suburban Businessman Pleads Guilty to Swindling Hospitals Out of Millions in PPE Payments

(WTTW News)(WTTW News)

At the onset of the COVID-19 pandemic, a suburban businessman swindled a hospital out of $2.5 million, pledging to provide it with half a million N95 masks, but instead taking the cash to buy cars and pay off his credit cards, according to federal prosecutors.

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Dennis Haggerty, 45, of Burr Ridge, pleaded guilty before a federal judge in Chicago Tuesday to one count each of wire fraud and money laundering after taking millions from an Iowa hospital in exchange for personal protective equipment he never provided.

Haggerty was the president of Illinois-based At Diagnostics Inc., which provides medical supplies for both personal and professional use.

In March 2020, just as the COVID-19 pandemic was beginning its break across the country, a university hospital in Iowa put in an order to Haggerty’s company for half a million N95 masks for a price of $2.495 million.

According to Haggerty’s plea agreement, he told the hospital to wire its payment to a bank account he claimed belonged to his company. But in reality, he was the only person who could access it.

Beginning the next day, Haggerty started to withdrawing funds from that account for his own personal use, the plea agreement states.

“Specifically, Haggerty withdrew approximately $147,750 in cash in sub-$10,000 increments to avoid federal currency reporting requirements,” federal prosecutors said in the plea deal, “paid $20,000 to a personal friend; paid approximately $188,534 to credit card companies; and purchased a 2013 Maserati Granturismo, a 2015 Land Rover Range Rover, and a 2017 Maserati Ghibli, for a total of approximately $132,519.”

When the hospital never received any masks, it demanded its payment back. But Haggerty “repeatedly and falsely” said his bank had never received any payment from the hospital. He similarly duped his own business partners, according to the plea, by giving them altered bank statements showing the “At Diagnostics” bank account had a balance of $1,000.

Around this same time, a hospital in Illinois placed an order with At Diagnostics for one million N95 masks at a cost of nearly $5 million. But this time, rather than wiring the funds directly to Haggerty, the payment was placed in an escrow account. When Haggerty once again failed to provide any masks, that money was returned to the hospital, according to the feds.

But months later in June 2020, that hospital inadvertently sent Haggerty more than $900,000 in connection with a second order for 500,000 N95 masks.

According to the plea agreement, Haggerty used some of that money to pay back the Iowa hospital approximately $250,000. He admitted in the plea agreement that he spent some of this money for his own personal use and did not return any of it, federal prosecutors said.

Haggerty faces up to 20 years in federal prison on the wire fraud charge and 10 years on the money laundering charge, though prosecutors note in the plea deal he will more likely face a sentence of between 37 to 46 months. He is scheduled to be sentenced May 25.

Contact Matt Masterson: @ByMattMasterson[email protected] | (773) 509-5431


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