On Sept. 24, the office of Minnesota Attorney General Keith Ellison charged 10 people with a collective 76 counts of manslaughter, assault, neglect, racketeering, theft, operating a comprehensive home-care facility without a license, concealing the proceeds of these crimes, perjury, and obstructing the state’s criminal investigation. They are the former owner, managers, and employees of Chappy’s Golden Shores, a now-closed assisted-living facility in Hill City.

Chappy’s former owner Theresa Lee Olson alone faces 25 charges, including one count of manslaughter for her conduct in the death of Chappy’s resident.

In addition to Theresa Olson, the defendants are Benjiman Howard Swanson, with whom Olson shares an infant child; Olson’s sister Lisa Michelle Anderson; Olson’s daughter Monika Lynn Olson; Alexcis Elizabeth Hines; Christina Michelle Meagher; Kristin Marie Davis; and Susan Joyce Ellis, all of Hill City; and Olson’s niece Janiece Freelove Mattson-Olson and Georgia Louise Salomonson, both of Grand Rapids.

The defendants have all been charged in Aitkin County District Court. The charges contained in the complaints are accusations; the defendants are presumed innocent unless and until proven guilty.

“Every Minnesotan deserves to live with dignity and respect. This does not exclude the sick and the vulnerable—it includes everyone. This means that every Minnesotan who needs care, deserves care, not abuse,” attorney general Ellison said. “My office is holding these defendants accountable for what we believe we can prove is systematic, intolerable abuse and neglect that in one case led to death, not to mention widespread fraud, theft, and other charges that hurt everyone.

“We are aggressively prosecuting this case. Whenever my office has jurisdiction, we will be aggressive in prosecuting criminal charges like it in order to protect all Minnesotans,” attorney general Ellison concluded.

The criminal case is being prosecuted by the attorney general’s office both because it was referred to the office by the Aitkin County Attorney and because the office has original criminal jurisdiction over cases of Medicaid fraud.

In early 2019, the attorney general’s office opened a criminal investigation into Chappy’s Golden Shores, an assisted-living facility located in Hill City, Minnesota, upon referral from the Aitkin County Attorney’s Office. As detailed in the criminal complaint against Theresa Olson, investigators reviewed over 1 million pages of documentary and digital evidence and conducted dozens of interviews of Chappy’s residents and employees, medical professionals, social workers, guardians, and other witnesses. They found the following:

Olson and certain Chappy’s employees subjected multiple residents to neglect by failing to provide them with proper health care, supervision, food or shelter. For instance, a 72-year-old Marine Corps veteran who resided at Chappy’s beginning October 2017, died in October 2018 of septic shock, an untreated urinary tract infection, and dysphasia and pneumonia complications which resulted from improper medical care and neglect. The medical providers who treated him just before his death described his catheter as filthy and characterized his 25 x 25 centimeter pressure sore as “[one of] the worst [they] had ever seen,” and the result of “utter, complete neglect” (Complaint pp. 25-29).

From Feb. 2017 to Feb. 2019, Chappy’s owner Theresa Lee Olson, with the assistance of the facility’s manager and several employees, bilked the State of Minnesota’s Medicaid program of over $2.1 million by billing for health care services that did not occur or were not covered by the Medicaid program because:

Chappy’s had no registered nurse on staff to assess and oversee the services provided to Chappy’s residents, some of whom required around the clock care. To hide this fact, the defendants submitted fraudulent licensing applications using the identity of a registered nurse who no longer worked at Chappy’s and forged the nurse’s signature on medical records, including the records of the resident who died from neglect (Complaint, pp. 15-17, 36).

Chappy’s housed residents at unlicensed, unapproved facilities. Conditions at one of the facilities included “holes in the closet leading to the exterior of the home, a broken window and door, visible water damage, and rodent nests and feces” (Complaint pp. 17-18, 23-24, 32).

Chappy’s billed for services provided by home health aides who had not passed required background checks. Some of the aides had convictions that would have disqualified them from providing direct care to vulnerable adults, such as assault and electronic solicitation of a minor. To conceal this from the state, Chappy’s listed these aides as “maintenance” or “custodians” and made sure they were not present for state licensing reviews. For instance, on Nov. 6, 2018, defendant Monika Olson messaged an aide: “[S]tate is in the house and will be at time of night shift as well. Please come in and go directly to the basement so they don’t see you until they are gone.” The individual had not undergone a background study and would not have passed a background study due to prior felony burglary and domestic assault convictions (Complaint pp. 17-20, 38).

Chappy’s billed for services that could not have occurred as the residents were not at Chappy’s on the dates billed. For instance, Chappy’s billed and received Medicaid funds for services resident a resident could not have received because according to Chappy’s own records, the resident was hospitalized at the time (Complaint pp. 20-21).

Shortly after Chappy’s license was suspended by the Minnesota Department of Health (MDH) due to substantiated allegations of abuse and neglect, Olson sold Chappy’s to her daughter, Monika Lynn Olson, for $1. The Olsons renamed the facility “Mont Royal” and attempted to obtain licensure from MDH. When MDH rejected Mont Royal’s license applications, the Olsons and other employees continued to house former Chappy’s residents and provide them with unlicensed health care services (Complaint pp. 22-24).

The defendants engaged in an extensive and coordinated effort to conceal evidence of fraud and maltreatment, falsify records in response to state investigations and convince potential witnesses to provide false or misleading answers to state investigators. A notebook seized during a search warrant at Olson’s home included a section titled “debunk [resident’s name]” and a list of reasons that 911 was not called when the neglect victim fell on ice at Chappy’s and broke her hip. A whiteboard seized from Chappy’s appeared to be a script for employees to follow when answering state investigators’ questions about another neglect victim. (Complaint pp. 30-32, 35-38).

After MDH began investigating Chappy’s, Olson and her husband withdrew over $1.7 million from Chappy’s bank account. When Chappy’s comprehensive home-care license was suspended by MDH, Olson sold two of Chappy’s buildings to co-defendants Monika Lynn Olson and Benjiman Howard Swanson for $1 (Complaint p. 38).

This case was investigated and is being prosecuted by the Minnesota Attorney General Office’s Medicaid Fraud Control Unit. Assisting law-enforcement agencies include the Aitkin County Sheriff’s Office, the Minnesota Bureau of Criminal Apprehension, the Hill City Police Department, the Itasca County Sheriff’s Office, and the United States Department of Health and Human Services Office of Inspector General.

Chappy’s Golden Shores has also been the subject of repeated disciplinary and administrative actions by the Minnesota Department of Health and the Minnesota Department of Human Services.

A copy of the state’s criminal complaint against Theresa Lee Olson is available on attorney general Keith Ellison’s website. The others are available on request.

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