Former HealthSouth CEO, Richard Scrushy got to breathe a huge sigh of relief as he was acquitted on 36 counts of conspiracy, mail fraud, falsifying statements, money laundering, and the like.
Scrushy was accused of being involved in a big $2.7 billion accounting fraud scandal that almost caused HealthSouth to go bankrupt. Had he been found guilty, he probably would have spent the rest of his life in prison.
Scrushy was originally charged with 85 counts, but that number was eventually reduced to 36. 15 other members of HealthSouth’s staff pleaded guilty to the crimes. As New York Daily News writes,
Scrushy is the first CEO acquitted of fraud charges since the government began prosecuting corporate wrongdoing following the collapse of Enron in 2001.
The verdict was a resounding defeat for federal prosecutors in Birmingham, Ala., who were aided by 15 HealthSouth execs who pleaded guilty to roles in the fraud. Five ex-finance chiefs testified against Scrushy, who was accused of inflating profit from 1996 to 2002 and propping up HealthSouth shares to enrich himself.
“God is good,” said Scrushy. “We went from 85 counts to zero…There are a lot of wrongs that need to be made right and I look forward to seeing that happen.”
The prosecution, who accused Scrushy of inflating HealthSouth’s profit between 1996 and 2002, obviously wasn’t as happy as Scrushy as the jury read the verdict.
“This is a stunning defeat for the government,” said Robert Mintz, a former federal prosecutor. “I think they have to be scratching their heads over exactly how this one slipped away from them. What the defense was able to do here was raise questions as to the motives of all of these various cooperators.”
After the reading of the verdict, HealthSouth issued a statement saying that Scrushy would not be allowed to come back to the company under any circumstances, because they found it appalling that such a gigantic fraud could even occur under his management.
Chris is a staff writer for murdok. Visit murdok for the latest ebusiness news.
