HealthSouth Corp., under investigation for massive accounting fraud, notified the Securities and Exchange Commission today that it will not be able to file its annual report by the March 31 deadline, company officials announced today.
The Birmingham, Ala.-based company said it intends to file a 2002 annual report "as soon as practicable." The nation's largest provider of rehabilitation services, HealthSouth also announced that it has postponed an annual meeting scheduled for May 15.
The SEC filed a civil complaint March 19 charging HealthSouth and its founder and CEO, Richard Scrushy, with overstating earnings by as much as $1.4 billion. Since then, Scrushy has been dismissed and three top finance officers have pleaded guilty to criminal fraud charges.
The company, which is on the brink of bankruptcy, is set to default today on a payment of about $367 million due to holders of fixed-income securities. Last week, HealthSouth's lenders froze the company's credit line, saying that bank loans totaling about $420 million were senior to the notes. -- by Michael Romano