Tuesday, February 22, 2005

CEO trials hold startling similarities

The accounting frauds at WorldCom and HealthSouth have nothing to do with each other. And yet, as the trials of former WorldCom CEO Bernie Ebbers and former HealthSouth CEO Richard Scrushy grind on in two courtrooms about 800 miles apart, it is clear that the criminal stories being told to jurors in these cases are nearly identical.

In both trials, a powerful CEO has been accused of instigating a fraud. Former HealthSouth chief financial officer William Owens testified in Birmingham, Ala., this month that when the company wasn't hitting its earnings targets in 1996, Scrushy ordered him to "fix the numbers." Owens interpreted the command as an order to commit fraud. Scrushy's lawyers say Owens was a rogue who misinterpreted the boss.

In New York last week, former WorldCom CFO Scott Sullivan told virtually the same story, testifying that when WorldCom didn't meet earnings expectations in 2000, Ebbers ordered him to "hit the numbers." Ebbers' lawyers say Sullivan is a liar, but the similarities between the cases don't stop there.

CEO trials hold startling similarities

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