HealthSouth settles SEC fraud charges for $100 million
Compliance Monitor, June 15, 2005
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HealthSouth Corp. put an end to its latest dealings with the Securities and Exchange Commission (SEC) last week by agreeing to a $100 million deal to settle civil fraud charges tied to the rehab provider's $2.7 billion accounting scam, the Associated Press (AP) reported June 9.
HealthSouth will pay out the settlement in five installments over two years, the AP reported. The SEC initially believed that HealthSouth overstated earnings by $1.4 billion over a four-year period that began in 1999, but later learned that the fraud stretched back to 1996--and up to $2.7 billion.
"This agreement is both a major milestone in HealthSouth's recovery and a powerful symbol of the progress we have made as a company over the course of the last two years," HealthSouth President and CEO Jay Grinney said in a statement, according to the AP.
HealthSouth earlier this year secured a $250 million revolving line of credit that will help the company pay off the settlement, the AP reported.
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