May 20, 2013
A federal judge has named Alabama's public pension system as the lead plaintiff for bondholders suing HealthSouth over losses from a huge accounting fraud.
The Retirement Systems of Alabama will represent all bondholders that have filed suit against the Birmingham-based medical services and rehabilitation company.
The pension fund asked to be named lead plaintiff in April. It says it lost more than $18 million amid a fraud the government contends totaled some two-and-a-half billion.
In all, Alabama fund managers said HealthSouth issued more than three billion-dollars' worth of bonds during the period the government contends HealthSouth was overstating earnings to meet Wall Street forecasts.
Eleven former HealthSouth executives have pleaded guilty to fraud charges, including all five of the company's chief financial officers.
