Charity President Charged With Embezzlement

By Josh Richman

Published June 16, 2006, issue of June 16, 2006.
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The former president of a hospital auxiliary in San Francisco has been charged with embezzling almost $166,000 from the charity, money that otherwise would have served needy patients for more than a year.

Gariel D. “Gary” Freund, 59, was arrested May 24 at his home in the city’s affluent Monterey Heights section; he faces 30 felony charges: two counts of grand theft, 14 counts of forgery, and 14 counts of possessing or receiving forged papers.

University of California, San Francisco police and county prosecutors believe that Freund — who was president of the Auxiliary at UCSF Medical Center at Mount Zion from 2002 to 2004 — forged signatures for unauthorized spending and withdrew cash with an unauthorized debit card.

Freund, a hotel and restaurant management consultant, entered a “not guilty” plea at his arraignment and is now free on $200,000 bail; if convicted, he could face up to 14 years in state prison as well as restitution payments. Freund did not return calls or e-mails seeking comment.

Mount Zion was San Francisco’s Jewish hospital until it merged with UCSF in 1990. Although it no longer operates under official Jewish auspices, many Jews remain involved in the teaching hospital and its nonprofit auxiliary, founded by 11 Jewish women in 1897. All but a few names on a recent auxiliary donor list appear to be Jewish.

The all-volunteer auxiliary uses honorary or memorial contributions, gifts from local philanthropists, and proceeds from its membership fees, events and gift shops to put up about $100,000 per year for patient services, ranging from taxi vouchers for doctor visits to support groups to medical equipment subsidies.

San Francisco District Attorney Kamala Harris called Freund’s alleged actions “an outrageous betrayal.”

“The victims in this case are not only the organization and contributors who generously donated the funds, but sick patients who needed the assistance,” she said.

The current president of the auxiliary, Meridithe Mendelsohn, told the Forward that Al Zemsky, then treasurer, discovered that the money was missing right around the time that Freund left the presidency in 2004. The missing money had been raised through fund-raising events. Contributions from specific donors were left untouched.

“It was obviously something that was well planned, but we don’t know what the circumstances were,” Mendelsohn said, adding that the board moved quickly to revise its fiscal practices to ensure against any such unauthorized spending or withdrawals in the future.

“Obviously we were very upset about it… but we’ve kind of moved on beyond it” during the past 22 months as the case wound its way through campus bureaucracy and onto the district attorney’s radar, Mendelsohn said. But the auxiliary still hopes to get the money back through restitution payments. “I think it’s a good thing for people to see we are getting justice now in terms of getting the money paid back,” the current president of the auxiliary said. “And we’re pretty confident of that… [Freund] has some properties we can attach.”

The auxiliary is a separate entity from the Mount Zion Health Fund, a supporting foundation of San Francisco’s Jewish Community Endowment Fund that makes grants in the larger community while still providing aid for new projects at UCSF Medical Center at Mount Zion.

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