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Virginia Tech Inc.
Friends paint different picture of man sentenced for fraud
Bill Cranwell faces a heavy fine and probation,but people who know him have argued in his defense. By JEN McCAFFERY THE ROANOKE TIMES Catherine Khabo Mazibuko Myers writes that her life changed when she met William C. Cranwell at his farm in South Africa, where her mother worked as a housekeeper. Bill learned about our culture and understood my family's circumstances." In 1996, Cranwell, who was sentenced last week for health care fraud, invited Myers and her sister to visit the United States. Once Myers was here, "Bill made me an offer that has truly changed my whole life and gave me the opportunity to help my family also," Myers wrote."He convinced me to stay here and go to college, which has made my fondest dreams come true." Myers has been in college for six years.By her account, Cranwell has footed the bill not only for her education, but also for housing, food, insurance, clothes, tutors and a car, even after Myers got married. This snapshot of Bill Cranwell as a compassionate, giving man is echoed in other letters addressed to U.S. District Judge James Turk.They wrote the letters before Cranwell's sentencing to try to convince the judge that there was more to Bill Cranwell than the recent convictions of the 67-year-old ; his company, HCMF Corp., which managed 18 Virginia nursing homes called Heritage Halls; and the company's treasurer, Pendleton Smith. On behalf of HCMF Corp., Cranwell pleaded guilty to charges that cost reports - which illegally claimed salaries and benefits for company owners, family members and friends - had been submitted to the federal government for Medicare and Medicaid reimbursements.He also pleaded individually to knowing that his two daughters were illegally paid by reimbursements.Both he and Smith, who faced a similar charge, were sentenced to probation.The company was ordered to pay $1.7 million in restitution and $275,000 in fines to the federal government. Now, due in part to the investigation, restitution and other financial penalties and obligations totaling more than $100 million, the future of American HealthCare, which had management of the nursing homes transferred to it in 1998, is in peril.Cranwell owns both HCMF Corp. and American HealthCare with his brother Robert Cranwell and Richard Frizzell of Blacksburg.A potential bankruptcy analysis in a report to the board of directors of American HealthCare found that the company had a 95 percent chance of bankruptcy within a year. Essentially, Bill Cranwell is a man of compassion; compassion for the indigent, compassion for the elderly, and a man with maybe too much compassion for his employees."William Cranwell may well have helped fund a mission in India in 1980 that now has more than 100 churches, a theological seminary and three orphanages caring for 276 children, as Ray Allen recounted in his letter to Turk.Unlike many other well-intentioned missionaries, however, Cranwell owned and could fly the airplane to get there.Cranwell was born in the coalfields of West Virginia and went on to travel to far-flung locales around the globe. Court documents filed by Cranwell's defense attorneys provide a time line of Cranwell's life.Cranwell and other family members declined to speak for this story. Cranwell was the eldest of five children: brothers Bob, Richard - the departing minority leader of the Virginia House of Delegates - and James, and a sister, Mary Ellen.In 1952 Bill Cranwell went to Virginia Tech, where he was a good student and star quarterback on the football team, court documents say.In later years, Cranwell would serve on Tech's board of visitors and give generously to the school. After college, Cranwell was determined to win back his father's wealth after his death in 1961, according to Cranwell's lawyers.He and his brother Bob started working in the construction industry. Cranwell married his high school sweetheart, Stella, in 1960, and the couple went on to have a son, Cliv, and two daughters, Corliss and Jane Ellen.During those years, Cranwell was working long hours and spending little time at home, according to his lawyers.He had become wealthy by the early 1970s, according to the documents.In 1979, he traveled with Ray Allen to India to establish ministries there. Meanwhile, Cranwell and his wife had grown apart, according to his lawyers.Though their romantic relationship ended, the couple remained close friends, the court document said.And when Cranwell learned in 1984 that he had another daughter from a relationship he had in college, he welcomed the daughter into the family, according to his attorneys. Cranwell joined forces in the late 1960s with a friend from the construction business named Dick Frizzell, according to Cranwell's lawyers.Hardie, Cranwell, Munford and Frizzell established HCMF Corp. and bought 18 nursing homes over the years that became known as Heritage Halls.When Cranwell learned that his daughters were being paid from health care reimbursements for work not related to the nursing homes, he contacted the company to ask officials to get them off the payroll, his lawyers argued. As a result of the investigation, Cranwell's lawyers argued, HCMF Corp. has more than $8 million in legal and professional fees.The future of American HealthCare and Cranwell's fortune are inextricably entwined, because Cranwell is personally responsible for the $1.7 million in restitution and other fines if the company, which Magee has said is $102 million in debt, cannot pay them.