“The findings in this report are not unique”

Stunning reports out of New Jersey lay bare what families and plaintiff attorneys have been warning about for years: when nursing home owners hide money through related-party shell companies, residents pay the price.

Acting Comptroller Kevin Walsh is demanding nearly $124 million from owners Daryl Hagler and Kenneth Rozenberg, accusing them of running a multi-year scheme to siphon public Medicaid funds into their own pockets while leaving Hammonton Center and Deptford Center dangerously understaffed. According to the state, these men moved $92 million through companies they and their relatives controlled — and then told regulators they spent less than 1% of that amount.

The scale of the neglect matches the scale of the fraud. OSC found the homes failed to meet minimum staffing requirements on 144 of 146 days, running with 52% to 54% fewer direct-care workers than required. Residents were left sitting in their own waste for hours, crying in pain without help, sexually assaulted, and denied basic supervision. One resident who required a pureed diet was knowingly served solid food and asphyxiated to death. Another, a wheelchair user, was dumped at a motel that couldn’t accommodate him, then abandoned outside a social services office before it opened. Between 2019 and 2024, the facilities generated over 3,400 emergency calls — a level of chaos and danger that no nursing home should ever reach.

What makes this all the more disturbing is that this isn’t their first time. Hagler and Rozenberg already paid $45 million last year to settle allegations that they diverted $83 million from four New York nursing homes, again resulting in resident harm. New Jersey’s findings make it clear: this is not a bookkeeping mistake or a one-off scandal. This is a business model. Inflate rent to your own property companies, run essential services through shell corporations, load the facilities with unnecessary debt, hide the transactions, and starve the building of staff so you can keep the money flowing upward.

Walsh said the quiet part out loud: “The findings in this report are not unique.” He’s right. The siphoning, the self-dealing, the secrecy — these aren’t exceptions in the for-profit nursing home industry. They are features. And until states force owners to disclose related-party spending, audit their financial pipelines, and tie reimbursement dollars directly to staffing levels, operators will keep exploiting the system while residents bear the human cost.

This isn’t just a financial scandal. It is a resident-safety crisis happening in plain sight. When owners treat nursing homes like investment vehicles instead of care facilities, the result is predictable: fewer staff, more injuries, preventable deaths, and residents living and dying in conditions no human being should ever endure. The New Jersey Comptroller’s report confirms exactly what frontline families already know — when corporate greed takes priority, dignity and safety disappear.