Former HealthSouth executive gets prison time
BIRMINGHAM, Ala. — A former HealthSouth Corp. finance chief has been ordered to spend three months in federal prison for his role in the $2.6 billion financial fraud that nearly wrecked the company.
A judge on Tuesday sentenced former HealthSouth finance chief Tadd McVay despite McVay’s pleas to stay out of prison.
McVay, who had pleaded guilty a scheme to inflate earnings six years ago, served five years on probation and six months of house arrest. But the 11th U.S. Circuit Court of Appeals agreed with prosecutors that the penalty was too lenient, so U.S. District Judge Inge Johnson ordered McVay to prison.
The court docket Wednesday did not say when McVay must report to prison or where he would be sent.
“I’m incredibly sorry for anybody who was hurt by my actions,” McVay told Johnson in court. “I’m embarrassed for what it’s done to my family.”
McVay was among five finance chiefs who pleaded guilty to crimes while working under Richard Scrushy, the disgraced former HealthSouth CEO. The fraudulent reports, aimed at meeting Wall Street forecasts, were sent to federal regulators between 1996 and 2002.
Prosecutors asked Johnson to sentence McVay to 28 months in prison, but the judge said McVay’s involvement in the accounting fraud was less than others who received less time.
“Basically, Mr. McVay, to make it short and simple, when these three months are gone, it’s over,” Johnson told him.
McVay was hired by Scrushy. McVay has said he was promoted to chief financial officer at HealthSouth in late 2002 and signed a phony earnings statement rather than lose his job, which paid him $400,000 a year.
Scrushy was acquitted of criminal charges, but a judge ruling in a shareholder lawsuit last month held him liable for the fraud and ordered him to pay $2.9 billion in damages. When the fraud was uncovered in 2003, HealthSouth was nearly forced into bankruptcy.
Scrushy is serving almost seven years in prison after being convicted with former Gov. Don Siegelman in a state bribery conspiracy.
Information from: The Birmingham News, www.al.com/birminghamnews
Filed under Legal Proceedings, News, Shareholder Lawsuit | Tags: Ala., Alabama, bankruptcy, Birmingham, Criminal, Damages, fraud, Fraud And False Statements, North America, United States, Us-healthsouth-sentencing | Comment Below
Related?
HealthSouth Corp. accuses ex-CEO Scrushy of hiding money in offshore bank accountsJuly 3rd, 2009 HealthSouth accuses Scrushy of hiding assetsBIRMINGHAM, Ala. — HealthSouth Corp.
Corporate expert says ex-CEO Scrushy left HealthSouth in a mess after FBI raid uncovered fraudMay 14th, 2009 Testimony: Scrushy left HealthSouth in a messBIRMINGHAM, Ala. — A corporate restructuring expert says fired CEO Richard Scrushy left HealthSouth Corp.
Judge orders ex-HealthSouth CEO Richard Scrushy to pay shareholders $2.8 billion in fraud caseJune 18th, 2009 Judge orders Scrushy to pay shareholders $2.8BBIRMINGHAM, Ala. — An Alabama judge has ordered former HealthSouth CEO Richard Scrushy to pay about $2.8 billion to shareholders due to accounting fraud at the rehabilitation chain.
HealthSouth shareholders ask judge to freeze Scrushy's assets during appeal of judgmentJune 19th, 2009 Shareholders ask judge to freeze Scrushy's assetsMONTGOMERY, Ala — Attorneys have asked an Alabama judge to freeze the assets of former HealthSouth CEO Richard Scrushy so they can begin collecting a nearly $2.9 billion judgment against him. An attorney for HealthSouth shareholders said the motion was filed Friday asking Jefferson County Circuit Judge Allwin Horn to stop Scrushy from hiding assets while the case is being appealed.
Trial opens in lawsuit by investors over HealthSouth fraud, seeking $2.6B from founder ScrushyMay 11th, 2009 HealthSouth civil lawsuit seeks $2.6B from ScrushyBIRMINGHAM, Ala. — Shareholders want HealthSouth Corp.'s founder Richard Scrushy to pay $2.6 billion for his alleged role in a huge fraud that nearly ruined the rehabilitation company, attorneys told a judge Monday.
Judge orders ex-HealthSouth CEO Richard Scrushy to pay $2.8B to shareholders in fraud caseJune 18th, 2009 Judge orders Scrushy to pay $2.8B to shareholdersBIRMINGHAM, Ala. — A state judge on Thursday ordered former HealthSouth CEO Richard Scrushy to pay about $2.8 billion to shareholders who sued over accounting fraud at the rehabilitation chain.
Judge orders ex-HealthSouth CEO Richard Scrushy to pay $2.9B to shareholders in fraud caseJune 18th, 2009 Judge orders Scrushy to pay $2.9B to shareholdersMONTGOMERY, Ala. — A state judge on Thursday ordered former HealthSouth CEO Richard Scrushy to pay nearly $2.9 billion to shareholders who sued over a massive accounting fraud that nearly sent the rehabilitation chain into bankruptcy.
HealthSouth shareholders ask judge to freeze ex-CEO's assets during appeal of $2.9B judgmentJune 20th, 2009 Lawyers seek freeze on HealthSouth ex-CEO's assetsMONTGOMERY, Ala. — Attorneys for HealthSouth shareholders asked an Alabama judge Friday to freeze the assets of former HealthSouth CEO Richard Scrushy so they can begin collecting a nearly $2.9 billion judgment against him.