Health care navigator Seedco has checkered past in Tennessee

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MEMPHIS, Tenn. -- During the first day of 2014 Affordable Health Care Sign-up, those enrolling, like Dorothy Wilburn, were anxious for help getting new health care.

"I came out to find out about it and hopefully get insurance also because right now I don't have any," Wilburn said.

The federal government is paying the company Seedco $1.4 million to help people in Tennessee navigate the insurance sign-up process.

"We are in the community spreading the word about what the Affordable Care Act is and how people can become enrolled," Seedco Navigator and Program Director Ellen Eubank said.

Yet Seedco comes with a troubled past. WREG first told you about it during last year's enrollment. The federal government actually sued the company for falsifying job placement statistics in New York.

Back then, Seedco said it made changes and was a  good steward of taxpayers dollars. The company called it an isolated case.

"I think that Seedco is in a better position than any other non-profit to take on this work because of what happened with us," former Seedco Director Lisa Pote told us in October 2013.

Turns out WREG wasn't the only one delving into Seedco's past. A conservative blog called The Tennessee Watchdog blasted Seedco after a similar job placement scam in Tennessee.

"I will use this analogy. If you have a plumber that comes over to you and he rips you off, odds are you won't use him again," Tennessee Watchdog Reporter Chris Butler said.

The federal government did use them again.

Seedco's new director in Memphis also told us the Job Placement problem in New York was an isolated case.

"That program no longer exists and the staff involved with that program is no longer affiliated in any way with Seedco," Eubank said.

WREG talked with the Tennessee State Comptroller's office and found a strikingly similar incident did occur in Memphis.

Last year, an audit found a Seedco subcontractor in Memphis paid clients thousands of dollars without verifying they actually did the work they claimed.

"The client reported info that they were showing up for work activity and when we verified through our team workers by contacting employers, we found the clients were not showing up for work activity," Jennifer Sydney, an auditor in the Tennessee Comptroller's Office, said. "$29,543 of fraudulent claims was paid to these clients."

So what did the Memphis Seedco representative say this time?

"Different program. Different set of circumstances," Eubank said. "That was a sub-contractor that we are no longer involved with. "

She admitted there had been a case in Memphis, too.

"We've got processes and procedures in place to assure we can provide the services we need and we are good stewards of the money we receive," Eubank said.

Tennessee Congressman Steve Cohen announced the $1.4 million grant Seedco received.

"Seedco won the grant. They have good experience and I am confident they will do a good job," Cohen said.

We asked if Congressman Cohen if he had any concerns  about Seedco's past.

"No," the Congressman replied.

"They are getting more money and you have to question whether or not it's wise to dole out taxpayers money to any organization that has such a checkered questionable history," Butler said.

Seedco continues to provide employment assistance to people in the Memphis community. Representatives say what happened in the past has no reflection on enrolling individuals into health care.

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