Former Exec Used $10K to Buy Church Stones

Link : http://story.news.yahoo.com/news?tmpl=story&u=/ap/20041101/ap_on_fe_st/blue_cross_headstones&e=5

PROVIDENCE, R.I. - The former president of Blue Cross & Blue Shield of Rhode Island used $10,000 of the company's money to purchase two stones to honor his family at a local church.



The engraved stones are outside the St. Francis Chapel in downtown Providence. The engravings honor the former president's parents, Ray and Irene Battista, of Warwick. The payment was accounted for as "charitable contributions," The Providence Journal reported.


Board chairman Frank Montanaro told The Journal he was unaware of the contribution.


"That is something new. I wasn't aware of that. I don't think the board would be aware of that," he told the newspaper. "We don't micromanage the affairs of the company."


Battista resigned in May, after it became known he had received a $600,000 to help pay for his divorce from his longtime wife and other perks from the nonprofit insurer, the largest in Rhode Island. The revelation spurred lawmakers to demand several changes to how the company does business.


The board this year agreed to ban loans to its officers, directors and employees and to cut contributions to its burgeoning reserve, which could lead to smaller future increases in the premiums the company charges.


Battista spent 33 years at Blue Cross and earned more than a half-million dollars a year in salary before his resignation. He negotiated a severance package worth $3.1 million, according to The Journal.


Battista also received from Blue Cross lease payments for his Mercedes and a $700,000 house he built in Warwick Neck with his new wife, who was his secretary at Blue Cross. Also, Battista, his father, and his first and second wives had received free acupuncture treatments worth more than $8,000 from a doctor who was trying to get Blue Cross to increase its coverage for acupuncture, The Journal reported.


Montanaro has credited Battista with turning around the company he says had lost more than $70 million over a three-year period before Battista took over.


Blue Cross paid for the stones in 2000 and 2001, as contributions to support St. Francis Wellness Center and food market, which serve the needy, according to two individuals associated with the ministry. A church fund-raising committee personally solicited Battista.


In return for each $5,000 contribution, Blue Cross received a table for 10 at dinners held in September 2000 and September 2001 at Rhodes on-the-Pawtucket in Cranston, a full-page ad in the dinner program and the engraved stones. Battista directed his parent's names be put on the stones, said Patricia Tramonti, who organized the fundraisers.


"I just assumed that's what his deal with Blue Cross was," Tramonti said. "We weren't going to call him and say, 'Are you sure you want them engraved that way?'"