IL: Use of administrative search power in aid of a Medicaid criminal investigation violated state constitution

The use of administrative search power in aid of a Medicaid criminal investigation made the search violate the Illinois constitution. People v. Lee, 2014 IL App (1st) 130507, 2014 Ill. App. LEXIS 167 (March 14, 2014):

[*P35] Here, defendant’s privacy interests were violated where the audit was used as a tool to further a criminal investigation. TrustSolutions was aware that a criminal investigation was ongoing and was in communication with law enforcement before, during, and after the audit. Documents taken during TrustSolutions warrantless search were turned over to law enforcement. Additionally, the scope of documents taken exceeded the stated purpose of investigating Medicare billing practices. The stated objective of the audit was to substantiate the allegations with the intention to turn over evidence to law enforcement. When all the evidence is considered, the record supports a conclusion that the audit served as a pretext for law enforcement to obtain documents to further its criminal investigation. Accordingly, the trial court’s finding that the audit was a pretext and that a search warrant should have been obtained was not against the manifest weight of the evidence.

[*P36] However, even if the audit was not a pretext for the criminal investigation, the record does not support the State’s assertion that defendant consented to the audit.

. . .

[*P38] Here, the State has failed to satisfy its burden that defendant consented to the search. The only evidence of verbal consent in the record comes from Poirier’s testimony. Poirier stated that he spoke with defendant over the phone and defendant “gave authorization” for the audit. The only details as to this verbal consent from defendant was described as follows: Poirier “notified [defendant] of what the on-site audit would entail, provided that [Poirier] had indicated the letter to Janice Roe and [defendant] said okay.” Defendant’s response of “okay” is ambiguous and does not demonstrate consent. Poirier never testified that he asked defendant for consent. In fact, when asked if he told the employees that they could refuse access, Poirier responded that “[n]o one asked so I didn’t volunteer a question that wasn’t posed.” Poirier’s testimony failed to describe any request for consent to perform the audit. The burden is on the State to establish consent to a warrantless search.

[*P39] The State also asserts that defendant consented because he allowed the auditors into his offices, provided them work space, and gave them whatever records they requested. This conduct does not demonstrate consent, but acquiescence to the requests from an authority figure. …