Former HealthSouth CEO on the hook for $2.9 billion
It is one thing to lose a court case and face a fine. It is another for the judge to put you on the hook for $2.9 billion.
Former HealthSouth CEO Richard Scrushy beat a federal charge of fraud could not do the same in a civil case. A judge decided that Scrushy knew the company was cooking the books and making up numbers to meet Wall Street estimates. The case was heard in state court. According to the AP, "The Alabama suit accused Scrushy of unethical dealings with the company while it was going broke and complicity in $2.6 billion in fraudulent reports it filed with regulators."Scrushy could be bankrupted by the decision. There are no public records of how much money he made at HealthSouth. He is currently in prison serving seven years on a bribery conviction. If he is broke, he may want to stay in jail. It may be the only way he can get three meal a day and a place to sleep. His house is bound to have been sold as part of a settlement before he is released.
Douglas A. McIntyre is an editor at 24/7 Wall St.