Former Hacienda Healthcare CEO avoids prison time in fraud case

Nov 19, 2021, 8:00 PM

William J. Timmons (Photo via Arizona Attorney General's Office)...

William J. Timmons (Photo via Arizona Attorney General's Office)

(Photo via Arizona Attorney General's Office)

PHOENIX – The former CEO of the Phoenix health care facility where an incapacitated resident was impregnated by a nurse avoided time behind bars in an unrelated fraud case, authorities said Friday.

A Maricopa County Superior Court judge sentenced former Hacienda Healthcare leader William J. Timmons to three years of supervised probation, the Arizona Attorney General’s Office announced.

In June, Timmons pleaded guilty to two counts of felony fraud and faced up to 12.5 years in prison on each count.

He was previously ordered to pay $500,000 in restitution to the Arizona Health Care Cost Containment System and $274,500 to the Attorney General’s Anti-Racketeering Revolving Fund as part of his plea deal.

A state grand jury indicted Timmons and his chief financial officer, Joseph O’Malley, in August 2020.

The two were accused of being involved in what prosecutors said was an elaborate white-collar fraud scheme that bilked Arizona taxpayers out of millions of dollars.

According to the indictment, Timmons and O’Malley “misallocated” money from the state from 2013 until June 30, 2018, by manipulating costs to avoid repayments of state funds in favor of inflated salaries and bonuses.

The case against O’Malley is ongoing.

Hacienda settled a related civil case last year by agreeing pay more than $11 million in restitution and penalties.

Hacienda Healthcare was in the headlines several years ago after an incapacitated woman gave birth and a nurse at the long-term care facility was accused of raping her.

Timmons resigned shortly after police said they were investigating.

Nathan Sutherland pleaded guilty to sexual abuse and abuse of a vulnerable adult in September and awaits sentencing.

Sutherland was arrested January 2019, almost a month after the pregnancy was discovered when a Hacienda employee was changing the garments of the victim and noticed the patient was in the process of delivering a child. Employees told police that they had no idea the woman was pregnant.

Sutherland, a licensed practical nurse at the time, initially pleaded not guilty. He was fired by Hacienda after his arrest and has since given up his nursing license.

Police have said Sutherland’s DNA matched a sample taken from the woman’s son. The victim’s mother is the boy’s guardian.

The case triggered reviews by state agencies and highlighted safety concerns for patients who are severely disabled or incapacitated.

The Associated Press contributed to this report.

We want to hear from you.

Have a story idea or tip? Pass it along to the KTAR News team here.

Arizona News

Arizona Attorney General Kris Mayes speaks during a press conference on April 4, 2024, the day of t...

Kevin Stone

Arizona House committee releases report calling for AG Kris Mayes’ impeachment

An Arizona House ad hoc committee released a report calling for the impeachment of Attorney General Kris Mayes, who dismissed the maneuver as a partisan ploy.

8 minutes ago

Father-son shooting in Glendale left dad dead, police say...

14-year-old Glendale boy accused of fatally shooting father

The Glendale Police Department said a father-son shooting left a man dead, which led to the arrest of a 14-year-old suspect.

21 minutes ago

Smoke can be seen from a camper fire that delayed traffic on Interstate 17 north of metro Phoenix, ...

NB Interstate 17 closed briefly north of metro Phoenix after camper fire near Bumble Bee

Northbound Interstate 17 was closed briefly north of metro Phoenix on Wednesday morning after a camper caught fire, authorities said.

2 hours ago

The Simmons Fire can be seen burning near Kearny, Arizona, on May 28, 2024. The fire has destroyed ...

Arizona’s Simmons Fire destroys at least 2 structures after prompting evacuations

At least two structures were destroyed overnight by a wildfire that prompted evacuations near the central Arizona town of Kearny.

4 hours ago

File photo of a Phoenix police crime scene. Police responding to a shooting in Ahwatukee on Tuesday...

Man killed, teen seriously injured in late-night shooting in Phoenix’s Ahwatukee area

A man was killed and a teenage boy was seriously wounded in a late-night shooting Tuesday in Phoenix’s Ahwatukee neighborhood.

5 hours ago

Auto thefts in Arizona fell from 2022 to 2023, new report found...

Auto thefts in Arizona fell 6% last year due to various factors, expert says

Auto thefts in Arizona fell last year by 6% compared to the year before, according to a new report from The National Insurance Crime Bureau.

5 hours ago

Sponsored Articles


Collins Comfort Masters

Here’s how to be worry-free when your A/C goes out in the middle of summer

PHOENIX -- As Arizona approaches another hot summer, Phoenix residents are likely to spend more time indoors.


Day & Night Air Conditioning, Heating and Plumbing

Beat the heat, ensure your AC unit is summer-ready

With temperatures starting to rise across the Valley, now is a great time to be sure your AC unit is ready to withstand the sweltering summer heat.


Collins Comfort Masters

Here’s 1 way to ensure your family is drinking safe water

Water is maybe one of the most important resources in our lives, and especially if you have kids, you want them to have access to safe water.

Former Hacienda Healthcare CEO avoids prison time in fraud case