Health Care Complaints Commission v Moawad

Factual Background

1. The following facts are uncontested. From 2009 to July 2012 the practitioner worked as an employed pharmacist at Roy Young Chemist Chatswood, ultimately as the General Manager. Towards the conclusion of that employment, the operator of that pharmacy, Pulse Pharmacy Group, entered into receivership. The receivers claimed that Mr Moawad was responsible for a significant debt within the company. While not conceding liability, Mr Moawad paid the receivers the sum of $243,000 sometime around November 2012.
2. In July 2012 the practitioner purchased a 50 % share of Town Hall Pharmacy Sydney (Town Hall), and in December 2013 he purchased full ownership of Harbourside Pharmacy in Darling Harbour (Harbourside). In May 2015 he purchased a further one third share in another pharmacy, with family members owning the remainder. The practitioner was the main Pharmacist in Charge at Town Hall, and one of three Pharmacists in Charge at Harbourside, but did not generally work at the third pharmacy run by family members.
3. A PBS audit of Town Hall covering the period November 2012 to July 2013 indicated irregularities in scripts in the name of a relative of the practitioner and two other patients.
4. On 7 July 2016 a representative of the Department of Health met with Mr Moawad and on 8 July 2016 the Department wrote to him requesting that he attend a formal interview. On 12 July 2016 a representative of the Department interviewed Mr Moawad about these irregularities and disclosed that the Department had obtained statements from all three patients that they had not received the relevant medications. In that interview the practitioner admitted to making false claims in relation to the three patients and offered to 'pay back every cent and more.'
5. At the 12 July 2016 interview, the practitioner was asked whether he had made any further false claims at his other pharmacies and he stated that he 'had a feeling' that he may have done so at Harbourside also. Mr Moawad undertook to check his records.
6. On 14 July 2016, the practitioner's father, a doctor, wrote a letter of referral for the practitioner to attend upon a psychiatrist, Dr Roberts. In that letter the practitioner's father made reference to the practitioner having a history of severe anxiety disorder, insomnia and major depression over the previous four years. On that same day the practitioner enrolled in the Pharmacy Board Ethics Course.
7. In August 2016, Mr Moawad disclosed to the Department of Health fraudulent PBS claims in the amount of $30,671 made in the names of three more patients (being the practitioner himself, a relative and one other patient) through the Harbourside Pharmacy covering the period since he had taken ownership, being December 2013 to July 2016. The patient history documents indicate that the claims were made in periods between July to November 2015 and between May 2014 to April 2016, for each patient respectively, and between November 2014 to June 2016 for himself.
8. It was not until November 2017 that the practitioner was issued with a court attendance notice in relation to a criminal charge concerning the false claims uncovered in the Town Hall audit. The criminal charge did not address the other claims later volunteered by the practitioner.
9. As a result of the practitioner's self-notification in November 2017 that he had been charged with an offence, the Pharmacy Council held s 150 proceedings in December 2017.
10. Despite regarding the admitted offence as very serious, expressing grave concern about the safety of Mr Moawad's practice, and finding that the public's confidence in the profession would be seriously undermined if a practitioner, having been charged with obtaining a financial advantage by deception during the course of their practice, was permitted to continue practise pending the resolution of proceedings, the Pharmacy Council determined that a suspension 'may be disproportionate'. This was because under Sch 5F, Cl 5 of the National Law a suspension from practice requires a pharmacist to dispose of any ownership interest in pharmacies. Instead, the Pharmacy Council imposed conditions that the practitioner not work as a pharmacist and not enter the pharmacies that he owned. That is, the conditions were expressly crafted to enable Mr Moawad to continue to run three pharmacy businesses; from two of which he had conducted the admitted frauds.
11. In April 2018 the practitioner was ultimately sentenced in the criminal proceedings to a wholly suspended sentence of nine months imprisonment in relation to the offence.
12. In September 2018 the HCCC interviewed the practitioner and in 2019 brought the current proceedings.
13. By the time of the hearing Mr Moawad was no longer a co-owner of the third pharmacy, but he continued to hold his interest in the Town Hall and Harbourside pharmacies.

The Hearing

1. The HCCC evidence comprised documents relating to the criminal proceedings and the Pharmacy Council and HCCC investigation processes, as well as health records from the practitioner's GP.
2. The practitioner's evidence largely comprised medical reports by his current treating psychiatrist, Dr John Roberts, his former treating psychologist Sam Borenstein and a variety of personal references. Mr Moawad gave oral evidence and Dr Roberts appeared by phone.
3. The HCCC sought both Mr Borenstein and the practitioner's father (in his role as a treating GP, having issued the referrals for Dr Robert's treatment) but neither witness was made available. In these circumstances, very little weight is accorded to either Mr Borenstein's report or Dr Moawad's purported diagnosis.

Findings

1. The Tribunal did not find Mr Moawad to be a particularly credible witness. We give Mr Moawad credit for having admitted to the alleged fraud from the audit period at Town Hall and promptly pleading guilty to the ensuring criminal charge, volunteering further fraudulent incidents at Harbourside and repaying the defrauded funds. Nonetheless, numerous aspects of Mr Moawad's conduct and evidence caused the Tribunal to doubt his candour.
2. There are three areas in which the Tribunal had reason to doubt Mr Moawad's credibility and candour, being: his circumstances at the time of the conduct; the extent of his admissions to investigators; and the circumstances of his current involvement in his relative's pharmacy business. All of these matters are explored below. Taken together they cause us to reject the practitioner's claim that he has taken full responsibility for the conduct and to conclude that he is not presently safe to practise and, indeed, poses a substantial risk to the health of members of the public.

Financial Circumstances and State of Health

1. Mr Moawad's evidence on his financial situation at the time of the fraudulent conduct was vague, shifting and at times contradictory.
2. In the 2016 Department of Health interview, Mr Moawad stated that he felt under financial strain, particularly given that within 18 months of opening his first pharmacy he had purchased a solely owned second pharmacy, which was not as successful as hoped due to redevelopment of nearby buildings. He also stated that he did not draw a wage from Town Hall Pharmacy at that time because it was not yet profitable enough to do so. However in the same interview Mr Moawad stated that he was 'making ends meet' at the time of the conduct in the audit, and that he had 'no legitimate reason' for the fraud as, 'I didn't need the money'.
3. In his 2018 written statement, Mr Moawad stated that the purchase of Town Hall pharmacy put him under financial stress and that he felt overwhelmed, and that, I had to take out a large loan to purchase town hall pharmacy and was left with no money in the ba[n]k account. This caused me to panic…
4. In the 2016 interview Mr Moawad claimed that he 'still had' the money he had defrauded and that he had not spent it; however when further questioned in that interview it became clear from his answers that the PBS funds went into the business bank account and became mingled with the business funds, paying for a range of expenses and contributing to keeping the business solvent.
5. During the 2016 interview Mr Moawad did not reveal that he had been asked to pay over $330,000 by the receivers of his previous employer sometime between July and October 2012 and that he had in fact paid $243,000 to them around November 2012. Nor did he mention this fact in the 2017 s 150 hearing at the Pharmacy Council when asked directly if there were any circumstances that had contributed to the conduct.
6. In 2018 the HCCC, having gathered some information concerning the receivers' claim, interviewed Mr Moawad and asked him directly about the circumstances of the repayment. Mr Moawad stated that he paid the $243,000 from his personal account and that it was 'family money'. When prompted by one of the interviewers asking whether this was 'inheritances', Mr Moawad replied, 'Inheritances from overseas.' Later in that interview Mr Moawad stated that he had not told his family or his father about the receiver's claim, only his wife.
7. In the hearing the Tribunal sought more detail from the practitioner about the source of the funds which he used to pay the receivers. Mr Moawad stated that he had inherited $200,000 from his aunt, who was his father's sister, that the money had been held by his parents for him, that he had wanted to keep it in reserve in case the Town Hall business needed it, but had asked his parents for access to that money when the receivers approached him. This is not entirely consistent with Mr Moawad's statement in the HCCC interview in 2018 that he had not told his family or his father about the incident with the receivers. If indeed Mr Moawad had ready access to $200,000 around November 2012 it is also hard to understand why in his 2018 written statement Mr Moawad stated that the purchase of Town Hall left him with no money in the bank and that this caused him to panic.
8. When the Tribunal asked where the remaining $43,000 came from to pay the receivers, Mr Moawad at first stated that it came from the Town Hall Pharmacy account and that he then 'paid it back'. However, when asked about whether this was an expense approved by his business partner (given it was to pay Mr Moawad's personal liability and not a shared business expense), he then stated that it had come from his own personal account and that this account had such an amount of funds in it because by then Town Hall Pharmacy was profitable.
9. Mr Moawad explained this by stating that at the end of every month the profits from the Town Hall business account were divided equally into his own and his partner's separate accounts. If large expenses came in which exceeded the monthly cash flow, they would then replenish the business account from their own funds.
10. This was not consistent with Mr Moawad's 2018 written statement in which he stated that he had no money in the bank after the purchase of Town Hall. When asked about this by the Tribunal Mr Moawad took considerable time to respond, and then stated that this written statement referred to the period immediately after purchase and that by November there were considerable profits available. Thus he was able to draw down $43,000 from the profit generated between July and November 2012. He further elaborated that there was profit at that time because the pharmacy had been purchased fully stocked.
11. While it may seem a strikingly unusual business model to empty a business bank account of any profits every month, and to pay them into a personal account (particularly when the business share itself is owned by a company, as was the case here), the Tribunal has no evidence before it to indicate that this did not occur. However it is not apparent from Mr Moawad's various accounts of events that Town Hall Pharmacy was in fact so profitable at this time.
12. The payment of the funds to the receiver represented a very substantial expense at the time a new business was starting. The Tribunal finds that Mr Moawad was in fact under financial strain in the latter part of 2012. The defrauded PBS funds claimed through Town Hall Pharmacy were used to fund the day to day operation of that business. Mr Moawad was also under financial strain during late 2013 and 2014 when he opened Harbourside and it was less profitable than planned. The defrauded PBS funds claimed through Harbourside likewise went into funding the day to day operation of that business.
13. The Tribunal concludes that there was a clear financial motive for the conduct.
14. Dr Robert's opinion that the conduct was an expression of a depressive illness rested upon the factual basis that the practitioner was not in a position of financial difficulty and had 'no financial need to do what he did'. Accordingly, we reject the characterisation of the conduct by Dr Roberts as done without any financial motive. We also reject Dr Roberts' characterisation of the conduct as so certain to be detected that it could only be understood as a form of self-destructive behaviour which was a 'cry for help'. The conduct at Town Hall went undetected for a considerable period, and the Harbourside conduct was not detected at all. We therefore place very little weight on the opinion evidence of Dr Roberts.
15. While Mr Moawad may have presented to Dr Roberts with symptoms of stress and insomnia, these are a predictable reaction to the detection and investigation of the conduct, which immediately preceded such presentation. There is no contemporaneous corroboration of the practitioner having suffered a major depression or any other form of impairment in the 2012-2016 period.
16. The Tribunal thus is unable to rely upon the practitioner's treatment program with Dr Roberts as evidence of the practitioner's insight, remorse or reformation.
17. As noted little weight is placed on Mr Borenstein's report of February 2018 because he was unavailable for cross examination. Like Dr Roberts, Mr Borenstein first saw Mr Moawad shortly after he was interviewed by the Department of Health, and accepted his account of a long-standing history of depression and anxiety.

Admissions to Investigators

1. During the July 2016 interview Mr Moawad made swift admissions to the Department of Health in relation to the three patients concerning whom he had made false claims at Town Hall Pharmacy. Mr Moawad also subsequently volunteered information relating to three other patients names he had used to made false claims at Harbourside.
2. However in the transcripts of Mr Moawad's interviews with the Department of Health, the Pharmacy Council, the HCCC and in his oral evidence before the Tribunal, Mr Moawad was not clear, direct or forthright about the offending conduct. At times he said he had no idea why he did it or how, as it was all a poorly recollected haze; when asked directly who the patients were or what method he used, he was in turn evasive, voluble, contradictory and non-responsive.
3. In the 2016 Department of Health interview in answer to a direct question about whether he had any idea which patients names he had used at Harbourside Mr Moawad stated that he did not know, but that he would check. In fact, one of the names was his own, and the most recent false claim was only a couple of weeks earlier.
4. The Tribunal asked Mr Moawad if he was confident that he had identified all of the false claims and returned all of the defrauded funds and his evidence was that he was very confident. When asked how he could be sure, Mr Moawad stated that he had checked at Harbourside and 'knew' which patient names he had claimed under.
5. When asked how he was confident that there were no additional false claims outside the audit period at Town Hall, given that the Department of Health interview occurred some 18 months after the audit period ended, Mr Moawad at first stated that he had 'just stopped' making false claims 'for no reason' around the time that coincided with the end of the audit period and so did not make any further check at Town Hall.
6. In response to further questions concerning why he would have suddenly stopped making false claims at one location and started at another at the time the audit period ended (given that he had no knowledge of the audit period at that time of the conduct), Mr Moawad stated that he had in fact checked the Town Hall records outside the audit period for the three patient names identified by the Department of Health, but not any other names because they were the only ones he had used there. He further claimed that he had kept no copy of his handwritten records of the searches he made at either Town Hall or Harbourside.
7. In these circumstances we are left in some doubt as to the fulsomeness of the admissions made by the practitioner.

Involvement in Pharmacy

1. In his current CV Mr Moawad notes that from 2018 to the present he has been working at a named pharmacy, with his duties listed as: helping with orders, deliveries, cleaning of store and managing of registers. He stated that he does not dispense prescriptions or undertake any of the duties of a pharmacist.
2. In oral evidence Mr Moawad stated that the pharmacy he currently works in was purchased in April 2018 by the same relative whom he previously co-owned a pharmacy with. That relative is the sole proprietor, although Mr Moawad 'helped' the relative by providing a sum of $200,000 around the time of the purchase.
3. In oral evidence Mr Moawad clarified that his duties included transferring stock between the relative's pharmacy, and his own Harbourside Pharmacy, including some prescription medications, and financial duties such as managing invoices and wages. He works around 20 hours per week but is not always paid a wage, depending on the profitability of the business, because it is not a PBS authorised pharmacy and so is not currently generating much turnover.
4. Mr Moawad stated that the funds he contributed towards the relative's pharmacy were a loan, but that there was no agreed repayment schedule, no interest, or end date to the loan, and no written or oral agreement concerning the terms of the loan. He stated that he was not a part owner and had no financial interest in that pharmacy. At the time of the hearing, almost two years later, none of the $200,000 sum advanced had been repaid to Mr Moawad. Mr Moawad stated that he had always just 'assumed' he would be repaid at some later stage when the pharmacy was more profitable.
5. Mr Moawad stated that he had paid the funds towards a 'fit out' of the relative's pharmacy and that the money came out of his own personal account as a result of profit from his own pharmacies. Mr Moawad's claim that these very substantial funds were a surplus he could afford to provide without any firm expectation of repayment stand in contrast to Dr Robert's June 2018 report which records that Mr Moawad was concerned about the financial viability of his pharmacies, had high business expenses and was 'fearful' that the Bank would not renew his loan.
6. As with other aspects of the practitioner's evidence, the vague, contradictory and at times implausible nature of these claims caused us to doubt his credibility and place little reliance on his assurances of remorse, reform and renewed commitment to professional standards. As explained below, the Tribunal does not accept the respondent's position that the practitioner is a 'truthful and straightforward' professional who can be trusted to return to practice under conditions.

Protection of the Health and Safety of the Public

1. The position of counsel for the respondent was that, while the practitioner had failed to maintain the high professional standards expected of him, he had not endangered the health or safety of the public, in that he had not affected the safety or personal well-being of an individual patient for example by issuing the wrong medication or over-charging.
2. This submission was to the effect that cancellation of registration would be disproportionate or punitive, on the basis that cases of cancellation of registration involving prescription irregularities 'almost invariably involve safety issues, such as self prescribing, dispensing addictive medication without a prescription, selling opioid drugs for profit or stealing medication for sale'. We note here the caution issued by the NSW Court of Appeal about drawing comparisons between case outcomes in the highly fact-specific context of health discipline: Chen v Health Case Complaints Commission [2017] NSWCA 186.
3. Counsel for the respondent further relied upon the practitioner's co-operation with investigators, statements of regret, several character references, and completion of CPD units, as well as the opinion of Dr Roberts that the conduct was a product of depression, for the proposition that there was no likelihood of repetition of the conduct.
4. While the character references speak well of Mr Moawad and several claim that the conduct was 'out of character' for him, many of the providers of those references were family members and friends, and a religious adviser, and their remarks need to be assessed in light of their natural deference to the account of events provided by Mr Moawad.
5. We do take note of a professional reference from a pharmacist whom Mr Moawad worked for early in his professional career. That reference speaks highly of the practitioner's professional abilities and personal qualities, but does also make the observation that when the author 'dropped in' to the Town Hall pharmacy a number of times during the period prior to the conduct being investigated, the financial management of that pharmacy appeared to be 'a total mess.'
6. We note that the practitioner enrolled in the ethics course within days of his conduct being detected in 2016, and that at the Pharmacy Council s 150 inquiry over a year later members of the Pharmacy Council encouraged him to complete the course. At the time of these proceedings, three and a half years later, Mr Moawad had not completed the course. He stated that this was because he got very busy 'working on himself' and with family responsibilities, and that the course had then 'timed out'. This does not reflect well upon Mr Moawad's commitment to ethical practice, or to demonstrating his renewed commitment to professional standards.
7. The HCCC submitted that Mr Moawad's conduct was very serious, sustained over a long period and represented a considerable part of the practitioner's career at the point it occurred. The HCCC submitted that the conduct was antithetical to the practitioner's responsibilities as a pharmacist and that the public protection required a cancellation order both because the extent of his reformation was in doubt and because denunciation was required.
8. The HCCC position was that practising under conditions would be insufficient to protect the public. Further, given the porous and unclear relationship between Mr Moawad's Harbourside Pharmacy and that of his relative, there was sufficient basis for the Tribunal to conclude that there was a substantial risk to the health of members of the public meriting a prohibition order addressing Mr Moawad's work in the pharmacy sector.
9. The Tribunal has concluded that cancellation of Mr Moawad's registration, as a pharmacist is required on two bases. First, we conclude under s 149C (1)(c) that, having been convicted a criminal offence, the circumstances of that offence render the practitioner unfit in the public interest to practise the practitioner's profession. The PBS system, which makes vital medicines affordable, relies upon the professionalism and integrity of pharmacists. Mr Moawad's lengthy, calculated defrauding of that system, from two separate pharmacies in which he was the Pharmacist in Charge and had ownership, render him unfit in the public interest to practise.
10. Second, we find that the seriousness of the misconduct is such that cancellation of registration under s 149C(1)(b) is the only appropriate order. This is required both in order to signal to the profession and the public the seriousness with which such conduct is viewed (see Health Care Complaints Commission v Do [2014] NSWCA 307) and because at the present time the Tribunal is not convinced at that the practitioner can be trusted in professional practice.
11. The Tribunal's adverse findings on the practitioner's credit, and the undocumented, unclear and co-mingled nature of his employment and business interest in his relative's pharmacy also lead the Tribunal to find that a prohibition order to prevent the practitioner from working as a pharmacy assistant is required. We note that the practitioner saw no conflict of interest or problem in his proposal that he work under conditions in his own pharmacy, notifying his employer (himself) of those conditions and working under a Pharmacist in Charge who was his own employee. The practitioner also did not see any cause for concern in his working for his relative in a pharmacy in which he had some ill-defined financial claim.
12. The Tribunal concludes that the health and safety of the public is at substantial risk in the broader sense, as the public cannot be assured that the practitioner will capably, competently or honestly, administer the PBS system which provides affordable publicly subsidised medicines. There is also an unacceptable risk to the public if, as appears likely, the practitioner were to work as a pharmacy assistant in the pharmacy of a relative whose business he has in part funded.
13. A non-review period of 18 months is required, both to signal to the profession and the public the seriousness of the conduct, and to enable the practitioner a period of time in which to demonstrate remediation: see Chen v Health Care Complaints Commission [2017] NSWCA 186.
14. Because the cancellation of registration of a pharmacist requires them to divest themselves of ownership of pharmacies, we defer the cancellation to allow a reasonable time for this to occur. Given that Sch 5F, Cl 5(2)(c) already effectively permits a pharmacist whose registration is cancelled or suspended a six month period from the date that such orders come into effect, we defer the cancellation order by 30 days rather than six months, allowing in total a period of seven months for divestment of ownership.
15. Conditions are imposed in the interim period prior to the cancellation order coming into effect in order to continue to prevent the practitioner from practising as a pharmacist. This is because, once this Tribunal makes orders, the s 150 conditions cease, and as we have made clear above, we do not regard the practitioner as currently safe to practise.

Costs

1. The HCCC was wholly successful in its case and is entitled to its costs. The respondent agreed to pay costs in a fixed amount and the Tribunal will make such an order.

Orders 1. Pursuant to s 149C(1) (b) and (c) of the National Law the registration of the practitioner as a pharmacist is cancelled, effective 30 days from the date of this order; 2. Prior to the cancellation of registration coming into effect, per s 149A(b) a condition is imposed on the practitioner's registration that he not practise as a pharmacist, must not enter any pharmacy in which he has a financial interest, and not work as a pharmacy assistant; 3. From the date the cancellation order becomes effective, per s 149C(5) the practitioner is prohibited from working as pharmacy assistant until such time as the Tribunal reviews order 1; 4. The practitioner may not apply for review of these orders for 18 months from the date of order 1 coming into effect per s 149C(7); 5. The respondent is to pay the applicant's costs in the amount of $14,000; 6. Pursuant to s 64(1) of the Civil and Administrative Tribunal Act 2013 (NSW) disclosure or publication of the names of Persons A-E in the schedule to the complaint is prohibited.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 10 March 2020