A whistleblower has come forward to Congress alleging that Steward Health Care CEO Ralph de la Torre and other Steward executives illegally conspired with foreign officials to secure a contract for a hospital abroad, CBS News has learned.
“In touting Steward’s perceived competitive advantage in Malta… de la Torre boasted that he could provide ‘brown bags’ to government officials if necessary to complete transactions,” Ram Tumuluri, a health care executive who worked for the Maltese government, wrote in a complaint to Congress shared with CBS News.
In the petition, sent to a U.S. Senate committee investigating the hospital company’s bankruptcy, Tumuluri describes a 2017 meeting with Steward’s CEO and alleges that de la Torre “insinuated that he would bribe officials of the Government of Malta.” An official at the committee confirmed receipt of the complaint and said it was being investigated.
In a statement, a spokesman for de la Torre called Tumuluri’s allegations “ridiculous” and said Steward’s international arm “acted in a lawful and transparent manner throughout the period in which the company operated in Malta.”
“There is no basis to accuse Dr. de la Torre of anything, nor is there any evidence that he or anyone else at Steward International engaged in any misconduct,” the spokesperson wrote.
Michael Nagle/Bloomberg via Getty Images
Tumuluri’s allegations come as an avalanche of criticism has descended on Steward, which declared bankruptcy earlier this year. A federal grand jury in Boston investigating the company is examining the compensation, expenses and travel of its top executives, including de la Torre, a person familiar with the matter told CBS News. And the whistleblower complaint comes as de la Torre has asked to delay his testimony on Capitol Hill in response to a summons which required him to appear on September 12.
Meanwhile, the Dallas-based company has struggled to find buyers for more than 30 hospitals it owns across the country. Last week, Two Steward facilities in Massachusetts closedwhich, according to the state, caused approximately 1,200 employees to lose their jobs.
CBS News reported on Steward’s activities as part of a one and a half year research document how private equity and other investment groups have siphoned off hundreds of millions of dollars from local hospitals with .
Documents seen by CBS News show that Steward hospitals across the country left a trail of unpaid bills, sometimes run the risk of running out of potentially life-saving supplies.
Last month, patients as young as five years old had to be abruptly transferred from a Steward-run mental health hospital in Phoenix after the air conditioning failed and temperatures in the building rose to 100 degrees Fahrenheit.
An investigation by the Arizona Health Department, which ordered the hospital to cease operations, found that the facility was consistently understaffed and had “multiple problems with HVAC systems, elevators and kitchen equipment, with no documentation of repairs made.”
The convening of a grand jury suggests that the embattled health care company and its executives could face criminal charges, but no charges have been filed.
De la Torre’s spokesman declined to comment on whether the CEO is the target of the federal investigation, but said any investigation into compensation “would demonstrate that Steward executives, including Dr. de la Torre, were paid below market rates according to acceptable industry standards.”
The money trail
An analysis of financial disclosures and bankruptcy filings has raised questions about whether De la Torre used the company’s money to fund an extravagant lifestyle, including two corporate jets owned by a Steward subsidiary worth $95 million, the Senate committee said.
In 2021, Steward’s owners paid themselves millions in dividends, the same year De la Torre purchased a 190-foot yacht worth an estimated $40 million.
In the year before it declared bankruptcy, Steward also paid tens of millions of dollars to other companies in which de la Torre had significant interests. Those payments included $37 million for “management fees” to a company called CREF in which de la Torre owned about 40 percent of the stock, according to a person familiar with the ownership structure.
A CREF spokesman said the company provided a range of “real estate and facilities services” to Steward’s hospitals and that De la Torre sold his stake last month.
The spokesman also confirmed that CREF won a competitive bidding process to oversee construction of a new science center named after de la Torre’s mother at the Dallas private school his children attended — an arrangement first reported by the Boston Globe. Bankruptcy filings show that Steward also donated $3 million directly to the school in 2023.
In her statement, La Torre’s spokesperson said the CEO “invested more — professionally, personally and financially — in Steward Health Care than he got out of it,” noting that he used his stake in Steward and other assets to personally guarantee loans made to the company.
“Dr. de la Torre went above and beyond to help Steward Health Care overcome the many headwinds and challenges in the industry, including personally purchasing the necessary equipment and supplies to meet patient needs and personally guaranteeing loans to the company with his assets,” the spokesperson wrote.
She pointed to a recent bankruptcy filing, which showed the company reimbursed him for more than $1 million in vendor costs he personally paid between May 2023 and April 2024.
The same file shows that during that period, de la Torre received a salary of more than $4 million.
Ignore a summons?
On Wednesday, De la Torre’s attorney, Alexander Merton, wrote to the Senate committee investigating Steward that his client “would not participate” in the hearing, arguing that testimony should be postponed until the bankruptcy proceedings were completed.
“Unfortunately, while Dr. de la Torre continues to fight for Steward Hospitals and the patients and communities they serve, members of this committee continue to discredit Dr. de la Torre and appear determined to turn the hearing into a pseudo-criminal proceeding,” Merton wrote.
The letter drew bipartisan pushback. Sen. Bill Cassidy of Louisiana, the committee’s top Republican, said “ignoring a congressional subpoena is consistent with a disregard for norms,” adding that it was important for de la Torre to address “allegations that assets were siphoned off” for his own financial gain.
In a joint statement, Senators Elizabeth Warren and Edward Markey, both Democrats from Massachusetts, said de la Torre “must be found guilty if he fails to appear before the committee.”
“Dr. de la Torre’s defiance of a subpoena to appear before the Senate is outrageous,” their statement read. “He owes the public and Congress an account for his appalling greed.”
A “campaign of unlawful coercion”
According to insiders, Steward’s business in Malta has attracted the interest of US prosecutors. In July, CBS News was the first to report it Federal prosecutors with the U.S. Attorney’s Office in Boston investigated Steward on several charges, including fraud and violations of the Foreign Corrupt Practices Act.
An attorney for the whistleblower, Andrew Bakaj, told CBS News in a statement that Tumuluri first raised his allegations that Steward violated the law — which prohibits U.S. citizens and entities from engaging in corrupt activity — with the Justice Department in April 2023.
Tumuluri’s company won a contract to run three public hospitals in Malta in 2015. In his complaint to Congress, Tumuluri alleges that De la Torre and other executives “colluded with” Maltese officials in a “campaign of unlawful coercion” to gain control of the contract Tumuluri’s company won.
According to the indictment, which runs to more than 500 pages, the conspiracy involved an attempt to have Tumuluri arrested and repeatedly threatened to kill him.
According to De la Torre’s spokesman, Steward only took over the contract with the Maltese hospital after Tumuluri’s company “failed to deliver on its promises” and government officials were looking for a replacement.
Last year, a judge in Malta annulled the contract altogether. An appeals court upheld the decision, citing “collusion between Steward and senior government officials or its agencies,” according to a report by the Times of Malta.
“With more damaging information coming to light every day, we call on both the Department of Justice and Congress to finally hold Steward accountable for putting personal gain above the health of the patients they treat,” Bakaj said in a statement.
A Maltese magistrate has recommended corruption charges against de la Torre and other Steward executives as part of an investigation. De la Torre’s spokesman wrote that the investigation “was not based on an objective or reliable investigation, and that there is no evidence of misconduct or illegal conduct by Steward International or its leadership.”
The Office of the Attorney General in Malta did not immediately respond for comment.
The magistrate also recommended that Tumuluri be charged, but Bakaj said he is not aware of any action by the Maltese government and called the investigation “far from independent, as it was initiated by political actors.”
“Mr. Tumuluri has offered his assistance and testimony to the Maltese authorities on multiple occasions to ensure that justice is done to the Maltese people,” Bakaj wrote. “Ignored by Malta, Mr. Tumuluri therefore approached the US authorities.”
