Ex-head of NY Hospital for Special Surgery charged

September 26, 2012 - 4:35 PM

NEW YORK (AP) — Authorities say the former chief executive officer of New York's Hospital for Special Surgery has been arrested in Massachusetts in a $1.4 million extortion scheme.

John Reynolds was arrested Wednesday at his Cataumet, Mass., home.

He was charged in federal court in Manhattan with racketeering and making false statements. The crimes are punishable by up to 25 years in prison.

Reynolds served as chief financial officer at the hospital from 1986 to 1997. He was its chief executive officer from 1997 to 2006.

Prosecutors say Reynolds engaged in a decade-long kickback scheme that solicited money from vendors, a hospital employee and a United Kingdom-based health care organization.

Reynolds' lawyer, Michael Grudberg, said the allegations are "without basis in fact or law" and Reynolds looks forward to his day in court.