A U.S. district judge in Birmingham, Ala., has re-imposed another judge’s earlier ruling that Malcolm “Tadd” McVay, a former chief financial officer with HealthSouth Corp., will not serve time in prison for his role in the rehabilitation service provider’s $2.7 billion accounting fraud.
In a re-sentencing hearing Thursday, Judge Inge Johnson gave McVay, 45, credit for the time he has served and fines he has paid since Judge U.W. Clemon sentenced him to six months of home detention and five years’ probation in June 2004, said James Ingram, an assistant U.S. attorney for the Northern District of Alabama. McVay had pleaded guilty to conspiracy to commit wire and securities fraud, falsification of financial information to the Securities and Exchange Commission and violation of the Sarbanes-Oxley act, said J. Don Foster, McVay’s attorney with Jackson, Foster and Graham in Mobile, Ala.
Originally, prosecutors had requested that McVay be sentenced to 65 months in prison, Ingram said, but the judge sentenced him to home detention and probation instead. After the 11th Circuit Court of Appeals in Atlanta had ordered a re-sentencing, the case was returned last fall, when prosecutors asked for 28 months in prison because of McVay’s “substantial assistance” in cooperating with the government officials. In re-imposing Clemon’s ruling, Johnson’s decision means that McVay will continue to serve his probation sentence until June 2009, Foster said. -- by Jessica Zigmond
