Ex-Togus worker pleads not guilty to receiving fraudulent benefits

Posted Oct. 06, 2010, at 12:51 p.m.

BANGOR, Maine — A Michigan man pleaded not guilty Wednesday in U.S. District Court to a variety of charges, including fraudulently receiving government benefits while he worked at the Togus Veterans Affairs Medical Center in Augusta.

Mark Stephen Palmquist, 43, of Menominee, Mich., appeared via video before U.S. Magistrate Judge Margaret Kravchuk in Bangor from U.S. District Court in Marquette, Mich.

Palmquist pleaded not guilty to making a false and fraudulent statement, theft of government property, fraudulent receipt of Veterans Affairs services and 21 counts of wire fraud.

He was released on personal recognizance bail after the hearing.

A criminal trial was set tentatively for Nov. 29.

In addition to the criminal charges, a lawsuit Palmquist filed in 2007 against the U.S. Department of Veterans Affairs over an issue at his previous job is pending in federal court in Bangor.

Palmquist worked as a patient representative at Togus from November 2006 to March 2010 but now is unemployed, according to court documents. Before moving to Maine, he worked for more than two years at the VA Medical Center in Iron Mountain, Mich., in the state’s Upper Peninsula on the Wisconsin border.

The indictment, handed up by the federal grand jury in Bangor on Sept. 15, alleged that Palmquist lied about his criminal background when he applied to work at Togus in 2006. He was convicted of assault and battery on June 4, 2001, according to court documents, but on his application he said he had never been convicted of a crime.

The bulk of the charges stemmed from disability payments Palmquist received due to injuries he suffered in a 1989 helicopter crash in Panama while serving in the U.S. Marine Corps. Palmquist suffered injuries to his back and brain that qualified him to receive disability benefits, according to court documents.

The amount of the monthly check an individual receives in disability benefits is based on the number of dependents being supported, according to court documents. Palmquist applied for dependent benefits in June 2002 when he married and was supporting a stepchild, according to the documents. He divorced the woman a year later but allegedly did not inform the proper authorities so his benefits could be reduced to what they had been when he was single.

The wire fraud charges stem from the fact that his benefit check was automatically deposited into a credit union account in Portland between Dec. 1, 2006, and May 30, 2008.

The total amount of money Palmquist allegedly received fraudulently was not listed in court documents.

Jury selection in Palmquist’s lawsuit against the VA is scheduled to be held on Nov. 2 in federal court in Bangor. He claimed in the complaint filed in July 2007 that a former supervisor in Michigan discriminated against him because of his disability and that her negative recommendation cost him a promotion to the regional office of the Veterans Benefits Administration in Nashville, Tenn.

Palmquist is seeking undisclosed compensatory and punitive damages.

In a pretrial memorandum, Palmquist’s attorney, David Webbert of Augusta, called the investigation that led to his client’s indictment “suspiciously timed.” Webbert also said that a Bangor Daily News story about Palmquist’s indictment had “greatly prejudiced” his right to a fair trial in the civil case.

Webbert urged that the case be moved from Bangor to Portland due to pretrial publicity, but a ruling has not been issued on his request.

Assistant U.S. Attorney James Moore, who is prosecuting Palmquist in the criminal case, said Wednesday that the two cases were “completely unrelated.”

Moore is not defending the VA against Palmquist’s lawsuit.

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