State investigating claims against Kanawha treatment facility

Layoffs at this drug treatment facility in Cross Lanes led former employees to file complaints with the state Division of Labor.
Courtesy photo
In 2006, the drug treatment facility’s owner, William Mucklow, pleaded guilty to two counts of battery after several caregivers said they were groped and tricked into changing his diaper.

State officials are investigating the business practices of a new drug treatment center in Kanawha County after at least 10 employees said the owner left them without a job or paycheck.

The inpatient facility is located in Cross Lanes, and a related outpatient facility is located at the rear of a South Charleston tax preparation business.

William Mucklow, the incorporator of New Beginnings Drug Treatment Center Inc., said he owes the employees a total of about $30,000, which he plans to distribute by July 1.

Mucklow received national attention in 2004 after he allegedly posed as someone with a mental illness and the behavior of an infant.

He later pleaded guilty to two counts of battery after several caregivers said they were groped and tricked into changing his diaper when they took care of Mucklow, only to find out he had no such mental illness.

Magistrate Warren McGinnis sentenced Mucklow to one year of home confinement. As part of a plea deal, the prosecutor’s office agreed to drop charges of fraudulent schemes and obtaining under false pretenses.

In an interview earlier this year, Mucklow said he hit the “apex” of a mental health crisis in 2005. He said the past has no effect on his current business ventures.

The employees of the inpatient facility gathered there on May 4 for computer training, only to learn Mucklow was laying them off. He said unexpected financial issues led him to temporarily stop accepting patients.

In a recent interview, five of the employees said they are concerned about past allegations of fraud against Mucklow.

Out of more than 20 laid-off employees, nearly a dozen soon filed complaints with the state Division of Labor, sparking the investigation.

“Those ex-employees are going to be compensated,” Mucklow said. “The department of labor is happy with that, and so is the prosecuting attorney.”

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A door separates the tax preparation office and the treatment facility in South Charleston.

Mucklow is an organizer and member of U.S. Tax and Financial Group, where he regularly works. An entrance to the outpatient arm of New Beginnings Drug Treatment Center is located behind the office.

Though he halted treatment at his inpatient facility in Cross Lanes, he said the outpatient location is doing well.

He said the remaining employees treat up to 100 patients at any given time, and pending Medicaid payments will help cover the existing back pay.

Every health care facility must apply for a National Provider Identifier number before it can bill Medicaid.

Mucklow said an error in the location’s original NPI caused a billing delay.

“I don’t know specifically what the issue was, but it has since been rectified,” he said.

In a May 8 letter to employees, Mucklow said the billing delay prevented them from being paid. He also blamed an investor’s decision to pull out of the company.

He said the investor pulled out one or two days before the layoffs, but he would not provide the investor’s name.

When pressed for more details, Mucklow referred questions to attorney C. Page Hamrick III.

Hamrick said he had never heard of New Beginnings Drug Treatment Center, nor was he currently advising Mucklow.

The attorney represented Mucklow when he was accused of not paying Lisa Allen for the nearly 49 hours she worked as his babysitter in 2004, according to a civil complaint.

“He calls now and then if he has a problem,” Hamrick said.

Mucklow said he met a new investor that will also help with paying the former employees.

“Once this thing is up and going, I’m not even planning to be involved with the running of the facility,” he said. “I’m just trying to get it up on its feet.”

He said the layoffs followed a learning curve, noting his inpatient facility accidentally treated three patients for free.

The facility, he said, admitted three patients who were not authorized to undergo treatment or bill Medicaid.

One patient had to leave after she was accused of buying drugs, he said.

The treating physician, Dr. Mohamad Kalou, discharged two other patients and then left the business after only two weeks, said his attorney, Richard Lindroth.

“He told me he tried it and it wasn’t for him,” Lindroth said. “He’s plenty busy with his Nitro practice and his Kanawha City practice.”

Kalou faced a lawsuit alleging fraud two years ago, but Mucklow said the suit never concerned him.

The West Virginia Medicaid Fraud Control Unit filed the suit against the doctor. Kalou overcharged Medicaid by more than $270,000, according to a civil complaint filed in Kanawha County Circuit Court.

Instead of billing Medicaid for one drug test, he billed the company for the screening of each individual drug, the complaint states. Both parties settled the lawsuit out of court.

Mucklow said he was concerned only with confirming the status of Kalou’s license and board certification.

In March, Mucklow listed Kalou as a board member for the New Beginnings Foundation Inc., a nonprofit organization incorporated by Mucklow.

Lindroth said Kalou was never on the foundation’s board of directors.

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Mucklow’s recent dilemma follows years of criminal charges and business fallouts.

Sherry Parsons said in 2004 that she witnessed two sides of Mucklow.

It happened when he arrived at a care facility in Cross Lanes where Parsons worked. She said Mucklow brought custom baby clothes, cloth diapers and safety pins adorned with a duck pattern.

She recalled having a conversation with her husband about bankruptcy while she was at work. That’s when Mucklow broke character and gave the couple financial advice, Parsons said.

Practical nurse Robert Meadows is one of several former employees of the inpatient facility who researched Mucklow’s past after the layoffs.

Meadows said he found a series of abandoned businesses and concerning accusations, leaving him with little hope of being paid.

“This is the job we were going to retire from,” Meadows said. “He ruined our freaking life.”

Meadows and several of his peers said they regret not researching their employer earlier. With a quick Google search, each nurse discovered records of infantilism and deceit.

Mucklow, referring to accusations from past business partners, repeatedly emphasized authorities never convicted him of fraud.

“Everyone that I know of has something that has happened in their life that they’re not proud of,” he said.

Accusations and settlements against Mucklow started at least 25 years ago:

n 1992: Snelling Temporary Services filed a lawsuit against Mucklow, who was later ordered to pay more than $2,400 to the company. He had failed to pay it for a service.

n 2003: John Lacaria said in a lawsuit he bought $10,000 in worthless stock from Mucklow. The suit was dismissed a year later after Lacaria’s counsel said the issue was resolved.

n 2004: The Gazette-Mail reported Jeffrey Andrews paid $250 to invest in Fedco, a nonexistent company. Mucklow allegedly deposited the investment in his personal bank account, a criminal complaint stated.

n 2004: Mucklow organized a 55-passenger bus trip to Canada. The trip was canceled for unknown reasons, and the Office of the Attorney General reached out to customers who paid $150 for a seat.

n 2005: Kanawha Judge Paul Zakaib Jr. granted a default judgment of more than $97,000 against Mucklow after a disgruntled business partner filed a lawsuit.

The partner, Norman Chill, said Mucklow siphoned money out of a joint bank account without authorization.

A securities commissioner previously ordered Mucklow to stop presenting himself as a registered member of the securities industry. Still, Mucklow advised Chill to liquidate his retirement account and buy what turned out to be 400 shares of useless stocks.

Mucklow filed for bankruptcy in 2005, but debt owed from the lawsuit is “non-dischargeable, as based on clear fraud, defalcation, or embezzlement,” according to a court ruling.

U.S. District Judge Ronald Pearson later decided Chill may collect damages against Mucklow’s “alter-ego companies, corporations, legal corporations, legal companies or any other legal entity created by William Mucklow.”

Throughout two separate interviews, Mucklow asserted that Chill’s lawsuit is in no way connected to his current businesses.

“I ended up going through and rebuilding my life, and that’s what this is all about, is rebuilding people’s lives,” he said. “New Beginnings — it applies as much to me as it does to the people who are trying to rebuild their lives.”

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More preparation might have softened the blow to Mucklow’s new treatment center.

His co-owner, Ethel Fleming, said the company should have protected itself with a wage bond or more capital before it opened.

A wage bond is a security that is “posted with the Division of Labor for the sole purpose of protecting wages and fringe benefits,” according to the agency’s website.

Though she advocated more preparation, Fleming twice said she was unaware of a problem with other investors.

“I’m over here in Harts [in Lincoln County],” she said. “I really don’t know what goes on in Charleston, but as far as my understanding, everything is on board like it should be.”

Dr. James Smith said he walked away from the company after his concerns slowly multiplied.

He said Mucklow’s ideas often fell outside the realm of financial and legal possibility.

Smith said he advised against housing the outpatient facility in a tax office, which he believed would lead to privacy violations.

“It became pretty clear that he did not know some of the most basic rules and regulations in medicine and was just making blanket assumptions like things would fall into place,” he said.

He was told the offices would be separated and, in a recent interview, Mucklow again said the two businesses would be detached. Mucklow also said at least one other person is an employee of both the tax office and treatment center.

Smith canceled a trip to Ohio and instead went to the company’s ribbon-cutting ceremony in January, when it was originally scheduled to open. The business received a license about one month after the ceremony, and its facilities opened two months after the licensure.

Mucklow said Smith was unable to accept a position with the company, but Smith said he walked away.

A lack of basic requirements caused the delay, he said.

“I was like, ‘If you are insistent on opening, I think we’re going to have to part ways, or we can do this the right way.’ And [Mucklow] basically just said my services weren’t required,” Smith said.

Angela Fragale, the center’s previous director of nursing, said she grew suspicious when the smallest questions, such as when the housekeeper would arrive, went unanswered.

Now Fragale is left with a sense of responsibility for the layoffs that followed.

“These are people who took this job because of me and, you know, now they’re in financial jeopardy,” she said.

Fleming said she is against rehiring former employees who complained after the layoffs.

“If they’re good workers in the medical field, there’s always jobs opening, so what’s the problem with that?” she asked.

Mucklow emphasized he is the sole person to make the final decision about any rehirings. Though he, too, said the complaints are surprising.

“They worked for a period of a couple weeks,” he said. “This isn’t like they’ve had lifelong jobs and careers that they’ve all of a sudden gotten trampled down upon. It’s a new business; they knew it was a new business.”

Fleming said Mucklow, whom she met about 10 years ago, is her accountant. She said her investment amounted to “a lot of money” but would not specify the amount.

“I want to help, because I work in an area where the drugs have took over,” she said. “And if I can help one person make a life of themselves, it’s worth everything.”

Mucklow said it cost about $200,000 to get the business started.

JPMorgan Chase Bank returned an employee’s check for $1,415 on May 3, according to a bank statement from Lisa Hanger.

Hanger said she left her previous job to join the treatment facility, as did several of her friends.

“Somebody had to help, and that’s what we do — we’re nurses,” she said.

Mucklow, referring to employees affected by the recent layoffs, said, “If I wanted to be a real a------ I’d go file bankruptcy on there and they’d not see a penny.”

Reach Giuseppe Sabella at,

304-348-5189 or follow

@Gsabella on Twitter.

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