Christian Lupica Leave a comment Background The s found year-old Richard Scrushy pumping gas in Selma, Alabama, thinking of better opportunities.
If they had co-operated with the authorities the fraud would have been detected. Nobody wanted to decrease their wealth that occurred due to their unethical practices.
Their loss of accountability and transparency is obvious. They became oblivious to the fact that they were cheating investors of millions of dollars.
Confusion is apparent because they did not know what was ethical anymore. Richard Scrushy was the mastermind behind this fraud. The Board of directors attested to the fact that Scrushy, should be held accountable.
They eventually figured out his intentions and became aware that his scheme was not in the best interest of the company and the shareholders. Due to her suspicion and whistle blowing she was transferred to another division Reeves, HealthSouth Board of Directors were not treated the same.
He received contracts for millions of dollars, to install glass at a HealthSouth in According to Striplin his company had the lowest bid of 5.
Scrushy acted surprised when he heard about this and stated that if he was aware of this, it would not have occurred. Within a few months after winning the bid, Striplin resigned from the litigation panel of which he was member.
He was awarded, the chairmanship of the board of directors committee and resigned from the auditing committee. This was definitely a tactic constructed via Scrushy and his longtime pal Stiplin, since he benefited financially from this as well. They were tipped off, by an anonymous HealthSouth shareholder.
A memo dated Novemberwas sent to the accounting firm, concerning a possible accounting fraud. The memo consisted of information regarding bookkeeping violations at the rehabilitation services company. Are these clever tricks to pump up the numbers, or something that a novice accountant could catch?
How can the company carry tens of millions of dollars in accounts receivable that are well over days? HealthSouth employees were also affected.
Fraud, bad attitude, hypocrisy, disrespect, frankness and deceit were a common and day to day practice among HealthSouth employees. Employees became scared of losing their jobs, also afraid of Scrushy compulsive authoritarian leadership style. Once a job responsibility was given, it was accepted and no questions should be sked.
They adapted their behavior according to the situation. HealthSouth became Birmingham HealthSouth hometown largest private employers, employees in an around the city. This was short lived; thousands of workers were laid off Employees who were suspected of pleading guilty were sacked or suspended Jennings.
Pension plan held 3. Accurate financial statements were not given to investors. They made their financials attractive for Wall Street to attract more investors. They refused to contribute to the balance of budget Act. They stated this would have a negative impact on the company.
This Act was to assist in reducing Medicare spending which HealthSouth relied on. Since Medicare fraud was a major part of their profits and they depended on it to increase their personal wealth and status.
The investors had huge loss on their stocks and shares fell once the fraud came public.HealthSouth fraud impacts millions HealthSouth is the largest provider of outpatient surgery, diagnostic imaging, and rehabilitation services in the United States.
The multinational. HealthSouth Impact on Stakeholders By admin In Essay Samples On March 28, The SEC charged and found guilty, fifteen executives ith accounting fraud they . HealthSouth Corp., the latest corporate giant accused of accounting fraud, likely will be thrust into bankruptcy this week in an action that could affect some of the company's Oklahoma employees.
Nov 24, · Both Scrushy and Michael Martin, HealthSouth’s treasurer and CFO for three years, engaged in large stock sales which provided them with plenty of motive to raise the company’s stock price. 3 In , Martin sold $3 million worth of HealthSouth shares while Scrusy sold a hefty $ million.
3 While testifying in regards to this sale, Martin. Health South Fraudulent activities perfumed by HealthSouth 2. Impact on stakeholders a. Impact on internal employees b. HealthSouth Scandals Negative Ramifications.
For Later. save. Related. Info. Embed. Share. Print. All Stakeholders Receive Negative Ramifications The HealthSouth scandal affected more than just the CEO and executives. HealthSouth the corporation felt an impact from the scandal.
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