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Who went to jail for the HealthSouth scandal?
Aaron Beam, the first chief financial officer of Birmingham, Ala. -based HealthSouth Corp., was sentenced to three months in jail today by a U.S. District judge in Birmingham. Beam was also fined $10,000 and ordered to forfeit $275,000.
What was the outcome of the HealthSouth scandal?
As a repercussion, the shares of HealthSouth fell overnight. The CEO was charged for fraud but acquitted of all the charges. He was only charged for bribery in the end. He, along with the CFO and various other officers of the company was imprisoned for a term of five years.
Who was affected by the HealthSouth scandal?
2. Stakeholders Affected: Stakeholders of HealthSouth included shareholders, employees, management, auditors, government, patients, customers, courts, tax authorities, SEC, stock analysts and investors. i. Shareholders: The most effected stakeholders in any accounting fraud case are shareholders.
Who blew the whistle on HealthSouth?
Weston Smith
Two of the finance chiefs — Aaron Beam, a HealthSouth co-founder and its CFO from January 1984 through September 1997, and Weston Smith, who blew the whistle on the fraud — recently offered a presentation to the New York City chapter of Financial Executives International.
How many years did Richard Scrushy serve?
He spent about five years in federal custody. In 2005, he had been acquitted of criminal charges that he orchestrated a $2.6 billion accounting fraud at HealthSouth, a medical rehabilitation company based in Birmingham, Alabama, that he founded in 1984.
What did Scrushy go to jail for?
bribery
Ousted HealthSouth Chief Executive Richard Scrushy, acquitted two years ago in a major corporate fraud case, and former Alabama Gov. Don Siegelman were both sentenced to prison on Thursday for bribery. Former HealthSouth CEO Richard Scrushy.
How long was Weston Smith in jail?
Because he went along with the fraud, he served a 27-month prison sentence. While the fraud occurred, slowly building up over 15 years, Smith was unable to sleep at night, and the stress caused his wife to divorce him. His life was falling apart as social responsibility weighed on him.
Who bought Richard Scrushy’s house?
The HealthSouth shareholder litigation group
The HealthSouth shareholder litigation group bought the homes at a public auction last year after arranging their seizure through the civil court system. Scrushy’s debt was then reduced by the appraised value of the homes — $7.8 million for the Lake Martin home and $4.3 million for Vestavia.
How much time did Richard Scrushy get?
six years and ten months
On June 28, 2007, Scrushy was sentenced to six years and ten months in a federal prison, ordered to pay $267,000 in restitution to United Way of Alabama, three years’ probation, and a fine of $150,000. Scrushy is also expected to personally pay for his time in prison and perform 500 hours of community service.
Who was the first CFO in HealthSouth?
Aaron Beam
The most severe penalties handed down in the case so far were five months imprisonment for a former assistant controller, Emery Harris, and three months for Aaron Beam, HealthSouth’s first CFO and a co-founder of the company with Scrushy.
How much time did Richard Scrushy serve?
While Scrushy was serving a seven-year sentence in a Texas prison, a civil court found him liable for the HeathSouth fraud. He was ordered to pay $2.87 billion in damages. After serving about five years of his sentence, Scrushy was released from prison. He now lives in Houston and works as a small-business consultant.
How accurate is the TV show Deadwood?
The award-winning show “Deadwood” was one of the most acclaimed dramas on television. It is not a production of the History Channel or a PBS series. The HBO series does weave actual events and characters with fictional script writing into its popular ongoing series.
What is the HealthSouth accounting scandal?
E&Y, the auditor for the company was also acquitted of the charges of fraud. HealthSouth, one of the largest healthcare services of the USA, came into notice when the company was accused of a huge corporate accounting scandal, the infamous $2.8 billion accounting scandal which went for years, 1996 to 2002, to be precise.
What was the first ever violation by HealthSouth?
The first ever violation by HealthSouth came into notice in the year 1998 when it was accused under the Securities Exchange Act for misrepresentation of the financial position of the company and the failure to disclose the negative trends. This was handled by the company until it became major, by the year 2002.
What happened to Richard Scrushy?
Included in the carnage was the imprisonment of CEO Richard Scrushy and several HealthSouth CFOs, among a number of other company officials.
Is HealthSouth a publicly traded company?
HealthSouth started out offering outpatient medical-care facilities but quickly segued to owning and operating rehabilitation hospitals, which is still the company’s main business today. Success came fast, and in 1986, just two years after its launch, HealthSouth went public.