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HealthSouth

By: Associated Press
By: Associated Press

Lawyers for fired HealthSouth CEO Richard Scrushy tried to portray a former finance chief, not Scrushy, as the head of a huge fraud at the rehabilitation company.

In today's cross-examination of former assistant controller Ken Livesay, a defense attorney brought out that former chief financial officer Bill Owens first came up with the idea of inflating HealthSouth's fixed-asset accounts as an audit loomed.

Livesay is one of 15 former executives who have pleaded guilty in the scheme.

To make it possible to hide fraud in fixed-asset accounts, Livesay said Owens brought more people into the conspiracy.

Referring to a corporate acquisition that workers used to hide some of the fraud, defense lawyer Art Leach suggested to Livesay that someone like Scrushy -- who is not an accountant -- would have had a hard time understanding what was going on.

Federal prosecutors allege that Scrushy was behind a scheme to overstate HealthSouth earnings for a seven year period that started in 1996.


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