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Ex-HealthSouth exec gets fine, but no jail

By Jay Reeves
The Associated Press

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Kenneth Livesay, a former assistant controller and information officer at HealthSouth, was sentenced to six months of home detention and five years on probation. He also was ordered to forfeit $750,000 he made through the fraud and fined $10,000.

Livesay had pleaded guilty to conspiracy to commit fraud and falsifying financial information. He also agreed to the criminal forfeiture.

Prosecutors had asked U.S. District Judge U.W. Clemon to sentence Livesay to five years in prison, saying he played a major role in the fraud by creating false entries with other top executives. But Clemon noted Livesay's assistance with the HealthSouth investigation and his lack of a criminal record in refusing prison time.

Livesay told the judge he didn't mean to hurt anyone but "made some bad choices."

His wife, Donna, and other relatives and friends cried with joy at the sentence. In court documents, the defense said Donna Livesay recently was diagnosed with multiple sclerosis and needed her husband at home.

Outside court, HealthSouth released the findings of its internal review of the fraud, which has resulted in plea deals for 17 former HealthSouth executives and charges against fired Chief Executive Richard Scrushy, who pleaded not guilty.

The company said its investigation found $2.75 billion in fraudulent entries and an additional $632 million in misstatements linked to improper accounting practices. The numbers could change as investigations continue, HealthSouth said.

Livesay was the sixth former HealthSouth executive sentenced in the case. Four more received probation; one, Emery Harris, got five months in prison.

Copyright © 2004 The Seattle Times Company

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