TeamBuilders report shows ‘unusual financial relationships’

By Steve Hansen
Staff writer

From 2006 to 2011, TeamBuilders Counseling Services made more than $3.7 million in lease payments to limited liability companies owned by TeamBuilders chief executive officer Shannon Freedle and members of his family.

That’s according to the final report of a 2013 audit of New Mexico Behavioral Health providers made public Thursday.

Neither Freedle nor his attorney Greg Richards could be reached Monday.

The study was conducted by Public Consulting Group (PCG) of Boston, for the New Mexico Department of Human Services.

TeamBuilders and 14 other state providers of behavioral health services had their payments suspended for Medicaid programs after the PCG audit was completed. They were replaced by five Arizona-based providers later in 2013.

TeamBuilders announced it was going out of business after HSD said it was suspending payments to TeamBuilders.

From 2009 to 2012, the report said,  TeamBuilders submitted more than 714,000 Medicaid claims and was paid nearly $77.5 million, accounting for more than 30 percent of the state’s Medicaid claims and payments as the largest single Medicaid behavioral health provider in the state.

TeamBuilders operated 52 facilities in 17 counties, including Curry, Roosevelt and Quay counties.

The 2013 study that resulted in TeamBuilders’ exit from the state had been held under wraps until Thursday, when the state’s newly elected Attorney General Hector Balderas opened the audit’s final report to the public.

In its discussion of TeamBuilders, the audit report says, “In conducting the standard enterprise review of TeamBuilders Counseling Services, an extraordinary number of unusual financial relationships and related party transactions were discovered.”

In further study of TeamBuilders’ records, going back to 2003, PCG “researched a number of limited liability companies owning properties that TeamBuilders rents. Most of these companies are owned by TeamBuilders executives and their families.”

When confronted with examples of TeamBuilders leases in Tucumcari to companies owned by family members in August 2013, Freedle’s attorney, Richards, said such dealings were legal and above board.  The rents paid were priced at “fair market value,” he said.

The 2013 report, however, quotes federal rules of tax-exempt non-profit organizations like TeamBuilders, that say such an organization “must not be organized or operated for the benefit of private interests, such as the creator or the creator’s family … No part of the net earnings of a 501(c)(3) organization may (be used to benefit) any private shareholder or individual.”

Some examples, according to the audit report:

• In 2007 TeamBuilders agreed to pay construction costs and rent payments totaling over $2 million over 10 years for property at 121 Towngate in Clovis to Plainview Properties, owned in whole or in part by Freedle and his family.

A company called RCH, Inc., based in Kerrville, Texas, was owned by Shannon Freedle or his brother Patrick Freedle. The address is the same as Patrick Freedle’s firm of Davidson Freedle Espenhover & Overby, in Kerrville, Texas.

• TeamBuilders also rented property in Clayton from Plainview Properties, LLC. Shannon Freedle was named as organizer of the company and its agent. From 2006 to 2016, lease payments were estimated at $139,000.

• TeamBuilders was leasing property in Santa Fe, from Yellow Brick Properties, LLC. Shannon Freedle is listed as Yellow Brick’s organizer and TeamBuilders’ chief operations officer Sun Vega is listed as its agent.  TeamBuilders spent $215,000 on leasehold improvements and paid a security deposit of $56,460.

From 2007 to 2017, lease payments were estimated to total just over $4 million.

James Halinan, spokesperson for Balderas said investigation continues on many of the 14 providers, including TeamBuilders.

Turquoise Health and Wellness, the company that replaced TeamBuilders, announced it is quitting business in the state as of March 1. Mental Health Resources, based in Clovis, will take over Turquoise’s operations.