A former White House official high up in the drug czar's office is named in a new federal lawsuit, accusing him of fraud in the drug rehabilitation industry and using his contacts to enrich his family.
Thomas McLellan served as deputy director of the Office of National Drug Control Policy from 2009 to 2012 in the Obama administration. The lawsuit is accusing McLellan and his son, Andrew, of holding on to millions of dollars from what it calls a "criminal, sham" addiction treatment center outside of Philadelphia.
The younger Andrew McLellan became a part owner and board manager of Liberation Way in 2015 after investing $300,000 that he was given by his father, according to the lawsuit. It also alleges that in 2016, Thomas McLellan offered to reach out "to his higher up contacts" that he used to work with to fend off an audit from an insurer that had developed "significant concerns" about Liberation's activity. A year later in December 2017, McLellan's son allegedly cashed out a nearly $5 million position in the company. And Newsy discovered county real estate records that show just one month later, he purchased this home in the Philadelphia suburbs for $2.9 million. On Zillow, the home is described as the “crown jewel” of its area, complete with a pool and seven bathrooms. By March of this year, state and federal officials charged Liberation's remaining owners with an elaborate insurance fraud scheme — alleging the company and its officers were getting kickbacks related to blood and urine screenings, and billing for medically unnecessary treatments. The company collapsed following the criminal charges of the remaining owners.
“These individuals profited off of the pain of these individuals who were battling addiction,” Pennsylvania Attorney General Josh Shapiro said in his announcement of the charges.
Neither McLellan was criminally charged. But now the key lender in the purchase of Liberation Way — Oxford Finance — is suing in civil court to get its money back, saying it lent the money based on fraudulent information from the owners, and it would therefore be "unjust" if the McLellans got to keep their millions.
“They were defrauded into making the loan, so from an equitable standpoint, people shouldn’t make money off their fraud,” said Andrew Rothermel, who was appointed CEO of Liberation after investors learned about the alleged fraud.
Neither the McLellans nor their attorneys returned Newsy's multiple requests for comment.
Advocates say the alleged actions of the former White House official and his son highlight larger concerns about what can happen when the little-regulated drug treatment industry doesn't put patients before profits.
“What that does to the psyche of someone trying to work a program, work on his recovery, it’s shattering. It’s mentally and emotionally shattering them,” said Maureen Kielian of Southeast Florida Recovery Advocates.