The Department of Justice is investigating Steward Health Care for potential corruption in its international business dealings, the company confirmed Thursday, the latest development in a high-stakes drama surrounding the Boston-born health care system.
The focus of the investigation is potential violations of the Foreign Corrupt Practices Act, a law that prohibits US companies or citizens — as well as foreign entities doing business on US soil — from engaging in bribery and other corruption overseas. The law also sets requirements for accounting practices abroad.
When asked about a pending foreign corruption probe, Steward spokesperson Josephine Martin confirmed in an e-mailed statement that the company is cooperating with an ongoing investigation by the DOJ. “As a matter of policy, Steward will have no further comment on this investigation as it remains ongoing.”
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A spokesperson for the Justice Department declined to comment, and a spokesperson for acting US Attorney of Massachusetts Joshua S. Levy did not respond to a request. CBS News, citing sources, first reported news of the investigation Thursday.
Steward’s international activities have already drawn substantial scrutiny, most notably in Malta, where the company first attempted to expand its brand overseas. The Globe reported in June that Steward executives Ralph de la Torre, its founder and chief executive, and Armin Ernst, the head of its international operations, have been accused of participating in a bribery scheme connected to a controversial deal to take over some of Malta’s hospitals. Maltese authorities have alleged that as the deal imploded, both men were part of a criminal conspiracy to siphon millions of dollars from their government to “consultancy fees,” rather than improve health care facilities they took over.
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The US federal government was involved in parts of the Maltese investigation into the failed public-private partnership, according to documents filed in court in Malta. In the fall of 2022, Maltese investigators handed over the electronic devices of former Maltese prime minister Joseph Muscat to a special agent for the criminal investigative arm of the Department of Homeland Security, seeking assistance to unlock the devices.
The Maltese investigation culminated in June in a 1,200-page report that recommended Ernst and de la Torre be charged with money laundering, criminal association, and corruption of public officials, including Muscat.
It remains unclear if Ernst, who lives in Brookline, or de la Torre, who relocated to Dallas along with Steward’s headquarters in 2018, will be charged in Malta. Under Maltese law, defendants cannot be charged in absentia, but the United States does have an extradition treaty with the island nation.
For extradition, Maltese authorities would need to present the Justice Department with evidence compelling enough to issue a warrant. In the report, Maltese investigators also recommended “the appropriate Authorities in USA be informed specially (sic) taking into consideration their Foreign Corrupt Practices Act (FCPA).”
In the United States, Steward is under scrutiny by federal lawmakers for its long-running financial problems that included reductions in services, shortages of critical supplies, and unpaid bills to many vendors. Founded in Massachusetts in 2010, Steward filed for bankruptcy in May, and under a court-supervised auction process, bids to buy its eight hospitals in Massachusetts are due Monday.
FCPA inquiries can take several years to resolve, experts said, citing the complicated process of proving bribery allegations overseas. Federal prosecutors also tend to investigate a company’s activities broadly after beginning an inquiry, meaning an FCPA probe could ultimately involve actions in multiple countries.
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”Once the DOJ or SEC understands what happened in Malta, they’ll ask the ‘where else’ question,” said Mike Koehler, a former FCPA attorney who has taught and written extensively about the corruption law. “Four years is the average length of time, and five to seven years is not uncommon.”
Separately, a businessman who sold the Maltese hospitals to Steward filed a a whistle-blower complaint with the US Securities and Exchange Commission last year alleging the company’s conduct in Malta was a violation of the corruption law. The SEC can investigate companies under the foreign practices law and impose civil penalties.
David Schumacher, an attorney and former federal prosecutor who investigated health care fraud, called it “extraordinary” for federal investigators to have “so many separate investigations in such a short period of time against a single entity.”
“My view is this is just the latest in a parade of horribles in the Steward story,” Schumacher said in an interview.
The latest inquiry, he said, should not further affect Steward’s planned auctions of its hospitals. “That should be an independent process, at arm’s length,” he said.

Dallas-based Steward has been under the watchful eye of federal investigators for months. In December, federal officials alleged Steward’s St. Elizabeth’s Medical Center in Brighton had submitted false claims to Medicare. Steward said Thursday that the Medicare federal case had been “administratively closed.”
In a bankruptcy hearing in June, attorneys for Steward also confirmed the federal government was reviewing the planned acquisition of its physician group, Stewardship Health, by Optum on the basis of antitrust violations. Optum has since walked away from the deal.
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And in 2022, Steward agreed to pay $4.7 million, following another Justice Department investigation into alleged violations of federal law.
Amid its financial challenges, Steward Health Care executives approved and spent millions on private intelligence firms tasked with surveilling and digging up dirt on critics of the company, according to a recent Globe Spotlight Team investigation.
Operations included videotaping a financial analyst inside his home and following him and his daughter’s commute to school, according to emails, encrypted messages, and financial records compiled by the global journalism outlet the Organized Crime and Corruption Reporting Project and shared with the Globe Spotlight Team. Another time, salacious details were plucked from a Steward executive’s phone. In the same time span, Steward failed to pay vendors that often provided critical supplies and staff to its hospitals, records show.
Federal lawmakers, already outspoken about Steward’s financial woes, have slammed the company for the allegations of fraud abroad.
“Led by Dr. Ralph de la Torre, Steward is just the latest example of corporate greed endangering our health system,” Senator Ed Markey said in an emailed statement Thursday. “Whether in Massachusetts or Malta, Dr. de la Torre used his credentials as a physician and CEO to sell Steward as a health care savior. Instead, he and his corporate enablers in private equity and real estate hollowed out a health system as they lined their pockets.
The investigations add another complexity for the company, which has struggled to raise cash and find new operators at home.
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The company recently pushed back by three weeks, to mid-July, a bid deadline for its Massachusetts hospitals. Optum, a potential buyer for its physician group, also recently walked away from the deal.
The exodus of patients from Steward has also overwhelmed other emergency departments in Eastern Massachusetts, prompting the state to mandate its health insurers also cover treatment at urgent care centers — even if the facility is outside their coverage network — through the end of September.
This story has been updated.
Jessica Bartlett can be reached at jessica.bartlett@globe.com. Follow her @ByJessBartlett. Elizabeth Koh can be reached at elizabeth.koh@globe.com or on Signal at koh.20. Follow her @elizabethrkoh. Hanna Krueger can be reached at hanna.krueger@globe.com or via the encrypted messaging app Signal at hsk.13.
