Hogan calls for investigation into 'Healthy Holly' controversy surrounding Pugh and UMMS

Posted at 3:37 PM, Apr 01, 2019
and last updated 2019-04-02 08:47:39-04

ANNAPOLIS, Md. — Governor Larry Hogan is calling on the Office of the State Prosecutor to investigate the controversy surrounding the University of Maryland Medical System’s purchase of books from Baltimore Mayor Catherine Pugh.

“These are deeply disturbing allegations, ” Hogan’s letter said. “I am particularly concerned about the UMMS sale because it has significant continuing ties with the State and receives very substantial public funding. ”

The unfolding controversy centers on the UMMS purchase of $500,000 worth of books from Mayor Catherine Pugh's business Healthy Holly LLC. At the time of the purchases, Pugh was a State Senator and a member of the UMMS Board. She has since resigned from that post, and returned $100,000 for the last book order. The deal drew the ire of many as a potential conflict of interest, and as well as a potential tax issue for UMMS as the non-profit labeled some of the book purchases, as well as other financial transactions, as grants in their 990 tax forms.

READ MORE: Independent auditor to evaluate UMMS board policies

Hogan initially called on leaders of UMMS to meet with Hogan, State Senate President Thomas V. Mike Miller, and Maryland House Speaker Michael Busch to discuss the potential conflicts at hand. The State Assembly is considering legislation to prevent the potential issues the scandal has brought to light and to hold responsible parties accountable.

In a letter addressed to State Prosecutor Emmet C. Davitt, Hogan asks for an independent investigation and for proper legal action if criminal wrongdoing is discovered.

READ MORE: Kaiser Permanente funds purchased thousands of 'Healthy Holly' books

The full text of Hogan's letter can be read below:

“Dr. Mr. Davitt,

Pursuant to 14-1076 of the Criminal Procedure Article of Maryland Code, I am writing you to request that you investigate the matters and facts surrounding Mayor Catherine Pugh’s sales of thousands of books to the University of Maryland Medical System (“UMMS”) while she was a board member. These are deeply disturbing allegations. I am particularly concerned about the UMMS sale because it has significant continuing ties with the State and receives very substantial public funding.

All Marylanders have an expectation that their public officials as well as individuals involved with institutions that are funded by and closely related to the State, will follow the highest legal and ethical standards. I understand and expect that you will fully investigate the matters that have been reported and that you will take all appropriate legal action in the event that your investigation uncovers any criminal wrongdoing. Of course, everyone in my Administration stands ready to cooperate and assist in all appropriate ways so that these issues may be resolved promptly.

I am mindful of the need for independence in these matters and appreciate the role of your office. Obviously, we do not want to interfere with your office’s investigations in any way. My goal is to assure that these types of problems do not ever reoccur, that appropriate personnel actions are taken, and that any improperly spend funds are recovered. We would welcome any guidance on how to pursue these issues without impeding your investigation.

Please contact my counsel, Robert F. Scholz … with any questions or concerns. Sincerely,
Larry Hogan