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HealthSouth

By: Associated Press
By: Associated Press

The Securities and Exchange Commission filed suit Monday against former Chief Financial Officers Bill Owens and Weston Smith for insider trading and fraud.

The agency said the two apparently sold almost $13 million in company stock during the time they admitted helping to inflate earnings. Sales records filed with the SEC show Owens sold $11.3 million in stock, while Smith is accused of selling $1.6 million.

An insider trading violation can result in forfeiture of some or all the sales price of shares sold with material considered nonpublic information. Owens and Smith pleaded guilty last month to securities fraud, admitting they had inflated the company's earnings.

They have agreed to assist federal prosecutors with their investigation of HealthSouth CEO Richard Scrushy. He has not been charged with a crime.


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