Following a three-day jury selection process, the federal government and defense attorneys for five former executives of the defunct National Century Financial Enterprises, or NCFE, concluded their opening arguments in U.S. District Court in Columbus, Ohio.
They all face federal criminal charges related to the 2002 collapse of NCFE several days after FBI agents raided its Dublin, Ohio headquarters. The charges against the five defendants include conspiracy to commit securities and wire fraud and money laundering. They are: Donald Ayers, vice chairman and chief operating officer; Rebecca Parrett, vice chairman, secretary and treasurer; Randolph Speer, a former chief financial officer and executive vice president; Roger Faulkenberry, director of securitization from 1994 to 2000; and James Dierker, vice president of client development from 1999 until 2000.
Earlier this year, the case of Lance Poulsen, the former president, chairman and director of NCFE, and James Happ, vice president of servicer operations, were severed from the case and will be tried in August and October respectively. Poulsen also faces charges of witness tampering at a separate trial expected to take place this spring.
NCFE purchased medical accounts receivable from providers who were typically in dire financial straits, raising the funds to purchase the accounts receivables by selling asset-backed bonds or notes to investors that were AAA-rated, according to prosecutors. Prosecutors alleged that the fraud led to the bankruptcy of approximately 275 healthcare providers and cost investors more than $1.9 billion.
In opening arguments Assistant U.S. Attorney Douglas Squires told the jury of seven women and five men, This case is about promises made, promises broken and a massive cover-up. Defense attorneys each argued that the governments case ignores the fact that with its purchased of accounts receivables, the company helped keep the doors open at more than 2,000 struggling healthcare providers.
Four former NCFE executives have already pleaded guilty and are expected to be called as witnesses during the trial. The government said it expects to call approximately 45 witnesses during the six to eight week trial. -- by Cinda Becker
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