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Former HealthSouth Chiefs Refuse To Talk At Court Hearing

Apr 24, 2003 | AP

Two former officials of HealthSouth Corp. who agreed to plead guilty in the firm's massive fraud case have refused to answer questions in court as lawyers for fired chief executive Richard Scrushy tried to show the scheme took place without Scrushy's knowledge.

Emery Harris, who was vice president and assistant controller of the rehabilitation services giant, invoked his Fifth Amendment right against self-incrimination 95 times Thursday.

Harris was questioned by attorneys for Scrushy and the Securities and Exchange Commission at a hearing on whether U.S. District Judge Inge Johnson should lift a freeze on most of Scrushy's assets while the government's probe of HealthSouth continues.

Scrushy has not been charged, but the government contends he was behind a scheme in which HealthSouth's earnings were overstated by $2.5 billion since 1997. Scrushy's defense contends he was not aware of the scam, which has been outlined by the government as 10 former top HealthSouth executives agreed to enter guilty pleas.

"We can't believe anything you said in your plea, can we, Mr. Harris?" said Scrushy attorney Tom Sjoblom.

"I insert my Fifth privilege," Harris replied.

Tadd McVay, a former chief financial officer of HealthSouth who also agreed to plead guilty in the fraud case, refused to answer questions Wednesday, asserting his right against self-incrimination more than 70 times.

McVay declined to reply to repeated questions from Sjoblom, who asked if former HealthSouth chief financial officer William Owens put him up to the fraud. McVay also invoked the Fifth Amendment when SEC attorney Bill Hicks asked questions about Scrushy's role.

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