HealthSouth founder and ex-CEO Richard Scrushy is found not guilty on all counts by a federal jury.
In the US District Court in Birmingham, a federal jury cleared Mr. Scrushy on 36 counts, including a charge of conspiracy related to $2.7 billion USD of alleged accounting fraud.
Prosecutors tried to pin $2.7 billion of overstated earnings over seven years on the former HealthSouth leader. Witnesses said the fraud began in 1996, with accounting changes ordered by Mr. Scrushy.
Fifteen officers and other executives of HealthSouth have pleaded guilty to a variety of charges related to the fraudulent activity. They told federal agents of numerous instances where false numbers covered up for repeated earnings shortfalls at the company.
That group, led by former chief financial officer Bill Owens, was responsible for the fraud, charged the defense team. Mr. Owens and others concealed the fraudulent activity from Mr. Scrushy.
Allegedly, federal prosecutors had evidence that the fraud began all the way back in 1988, yet declined to attempt to prosecute anyone immediately. Legal analysts observing the trial, particularly the testimony against Mr. Scrushy, were stunned at his acquittal.
David Utter is a staff writer for Murdok covering technology and business. Email him here.
