Financially troubled Dallas-based Steward Health Care is under criminal investigation by federal prosecutors at the U.S. Attorney's office in Boston, CBS News reported July 11.
"Steward Health Care can confirm it is aware of and cooperating with an investigation by the U.S. Department of Justice," a spokesperson for Steward said in a July 12 statement shared with Becker's. "As a matter of policy, Steward will have no further comment on this investigation as it remains ongoing."
Federal prosecutors are investigating allegations including fraud and violations of the Foreign Corrupt Practices Act, two sources told the publication.
The Foreign Corrupt Practices Act of 1977 was "enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business," according to the Justice Department's website.
A deal with the European country of Malta wherein Steward was tapped to operate three state-owned hospitals has gone sour, with the deal now part of a criminal corruption probe. Steward and its executives have not been charged with connection to the Malta situation, CBS reported.
Back in the U.S., Steward, which filed for bankruptcy May 6, is looking to offload its 31 hospitals and physician group, Stewardship Health, in an auction.
In the latest hit to the health system, UnitedHealth Group's Optum recently backed out of plans to acquire Stewardship Health. The auction dates for some of Steward's hospitals have also been pushed back.
The Justice Department declined to provide Becker's with a comment.
Becker's has also reached out to Massachusetts Gov. Maura Healey's office and will update this story if more information becomes available.
Editor's note: This story has been updated as of July 12 at 8:45 a.m. CT.