French care home group Orpea plunged into crisis by mistreatment allegations

A disaster engulfing French care dwelling operator Orpea has deepened after the federal government summoned the chief govt to reply to allegations made in a brand new e-book that it systematically mistreated aged residents.

The corporate’s shares fell an additional 10 per cent on Thursday and have misplaced half their worth since Monday when journalist Victor Castanet revealed the findings of a three-year investigation in a e-book titled “Gravediggers”. He additionally alleged he had been supplied a bribe to cease his work.

“I used to be pressured and threatened, and so had been a few of my sources,” he instructed French channel BFM TV. “Midway by the investigation, through an middleman, a proposal was made to see if I might cease my work for €15m.”

A spokesperson for Orpea stated the corporate “formally denied” any fee was supplied to cease publication of the e-book.

The e-book alleges the corporate minimize corners to economize on the roughly 370 nursing houses it operates in France, inflicting aged residents to be handled poorly. One worker at a care dwelling in a rich Paris suburb the place residents pay beginning charges of €6,500 monthly stated she was instructed to ration grownup nappies and solely enable individuals three a day.

Orpea on Monday known as the allegations made by the e-book “outrageous and prejudicial”. However on Wednesday its board of administrators stated it will mandate two consulting companies to hold out an impartial investigation of the e-book’s allegations and promised to share the findings with regulators.

“We proceed to affirm that at no time did the group’s administration put in place any system to orchestrate the practices that it’s being criticised for,” Orpea stated.

Orpea has expanded quickly lately into greater than 20 international locations, incomes €3.9bn in income and €467m of working revenue in 2020. France and the Benelux area are its largest market, producing 60 per cent of gross sales from 372 houses.

It now faces a possible political scandal, with politicians calling for a parliamentary investigation and the federal government vowing to impose “sanctions of the best severity” if the allegations are true.

Shares in rival French care dwelling operators have additionally bought off this week as buyers fear in regards to the fallout: Korian has misplaced virtually 30 per cent of its market worth and LNA Sante 18 per cent.

Castanet stated he was stunned by the impact of his e-book. “I assumed this may be a nationwide scandal however I didn’t suppose there can be such a shockwave or that so many households would get in contact with me,” he stated. He additionally predicted a collection of authorized complaints in opposition to Orpea within the coming days from the households of residents and workers.