Richard Scrushy, founder and former CEO of HealthSouth Corp., Birmingham, Ala., was directly implicated in court testimony yesterday by two former CFOs as having played a role in years of financial misconduct at the company. Former HealthSouth CFO Michael Martin, 42, and former CFO and Treasurer Tad McVay, 41, pleaded guilty yesterday in U.S. District Court in Birmingham to conspiracy to commit wire and securities fraud and to filing false information with the Securities and Exchange Commission. Federal prosecutors are continuing their effort to build a criminal case that Scrushy was personally involved in massive accounting fraud at the company. Eleven individuals, including all five of HealthSouth's former CFOs, have been charged in the criminal case, but no charges have been filed against Scrushy. Scrushy and HealthSouth have been named in a civil complaint filed by the SEC, which contends HealthSouth overstated earnings by as much as $2.5 billion since 1997. Scrushy's attorneys have maintained he had no knowledge of such events. -- by Julie Piotrowski
Scrushy implicated in two former CFOs' testimony
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