Arizona health care CEO sentenced to 14 years for embezzling $33M from tribal organization

PHOENIX — An Arizona health care CEO was recently sentenced to 14 years in prison for embezzling $33 million, authorities announced Friday.

Kevin Lamorris McKenzie, who is from Tucson, previously pleaded guilty to conspiracy to commit wire fraud and embezzlement from a tribal organization, according to the U.S. Attorney’s Office for the District of Arizona.

Between 2015 and 2023, McKenzie — first as Chief Operating Officer and later as CEO of Apache Behavioral Health Services (ABHS) — ran a scheme to steal millions from ABHS and the White Mountain Apache Tribe, prosecutors said.

Health care CEO has to give up luxury cars, several properties, more

As part of his punishment, McKenzie must pay ABHS $33,155,701.

He also has to give up several properties, luxury cars (including a Rolls-Royce, Ford Galaxie, Range Rover and a Cadillac Escalade), a utility trailer and $55,000 in cash.

In addition, more than $364,447 seized in another case will go toward what he owes.

These financial penalties highlight the scale of his embezzlement scheme.

Details about embezzlement schemes health care CEO orchestrated

The 49-year-old used two fraudulent contracts to move money from ABHS into his own pockets.

Here are the details of the first contract he used to secretly move money from ABHS to himself:

• ABHS paid over $35 million to a company called Helping Everyday Youth (HEDY).
• McKenzie had a secret deal with HEDY: they sent about $16 million to a shell company he controlled.
• McKenzie hid this arrangement from ABHS and disguised the transactions through his shell company.
• He even tried to pressure a witness to lie to investigators, prosecutors said.

The second scheme prosecutors described ran from 2018 to 2023. Here are the details:

• McKenzie, as ABHS CEO, made fake referral contracts with co-defendant Corina Martinez.
• These contracts claimed that Martinez’s company, Evolved Health Care Inc. (EHI), would refer employees to ABHS for payment.
• In reality, EHI never referred anyone.
• Using these fake agreements, McKenzie caused ABHS to pay $16.5 million to EHI.
• McKenzie and Martinez split the money. Martinez gave McKenzie large sums of cash, paid $800,000 in credit card bills, and bought luxury items, including a $128,000 Rolls-Royce Ghost and a $928,000 home for McKenzie’s family.
• EHI provided no services to ABHS.

His 14-year sentence will be served concurrently with a separate 5-year sentence, prosecutors said.

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