Former State Employee Sentenced to Five Years in Prison
for Theft of $1.7 Million
Claims Processor Stole from State Funded Health Program

BALTIMORE, MD (February 11, 2009) - Attorney General Douglas F. Gansler announced today that Donna McRae Lam, 51, a former State employee convicted of stealing $1,768,726.00 from the Maryland Kidney Disease Program (KDP), was sentenced by Baltimore City Circuit Court Judge Sylvester B. Cox, Jr., to 10 years incarceration with five years suspended, and five years probation. The Judge also ordered Lam to pay restitution in the amount of $1, 541,329.72.

Lam was employed by the Department of Health and Mental Hygiene (DHMH) for 13 years before she moved into the position of claims processor for the agency’s Kidney Disease Program (KDP). The KDP is a state-funded program that assists Maryland residents struggling to pay the extraordinary medical bills associated with end-stage kidney disease. Beginning in May 1997, Lam added 14 fictitious providers to the KDP computer system and filed a total of 917 fake claims for payment. Lam and her husband, Wilson Allen Lam, opened numerous bank accounts and post office boxes throughout Maryland to collect the State checks that were subsequently issued. The Lams spent the stolen money on real estate, home improvements, motor vehicles, jewelry, and gifts to family members.

Before imposing his sentence, Judge Cox stated that Lam’s actions were, “the highest form of the violation of trust by a public employee.” The Judge also stated that Lam’s actions were eclipsed only by recent acts on Wall Street.

This guilty plea was the result of a multiple-agency investigation performed by the Criminal Division of the Attorney General’s Office, the DHMH Office of the Inspector General, and Maryland State Police. In making today’s announcement, Attorney General Gansler thanked Assistant Attorney General Kate O’Donnell for her work on the case.