Look at NCFE not Fannie or Freddie for the root of the financial corruption!

"...that he never completely told the truth to the government until he signed a plea agreement in 2007."

"...Dublin-based health-care financing firm, it was funding businesses owned by National Century CEO Lance Poulsen and others without getting the businesses’ accounts receivable in return."

"...For some companies, however, National Century didn’t actually purchase receivables, Bily said. It just advanced funds."


"...National Century Financial Enterprises Inc. was advancing money to health-care providers without getting any collateral as far back as 1994, a witness testified Monday."


Monday, October 6, 2008 - 1:58 PM EDT
Witness: Alleged fraud at National Century stretched back to '94
Business First of Columbus - by Kevin Kemper

National Century Financial Enterprises Inc. was advancing money to health-care providers without getting any collateral as far back as 1994, a witness testified Monday.
Jessica Bily, a former data analyst who worked her way up to become associate vice president of funding at National Century, testified that from nearly the beginning of her days at the Dublin-based health-care financing firm, it was funding businesses owned by National Century CEO Lance Poulsen and others without getting the businesses’ accounts receivable in return.
Poulsen, 65, is standing trial in U.S. District Court in Columbus on charges of securities fraud, wire fraud and money laundering relating to the firm’s 2002 collapse into bankruptcy. The government has alleged as much as $2.84 billion in investor money was missing when National Century collapsed, a result of alleged self-dealing on the part of Poulsen and other National Century executives.

Considered a lender of last resort, National Century purchased accounts receivable from health-care providers at a discount in exchange for quick cash the provider could use to pay bills. National Century then packaged the receivables as bonds to sell to investors. For some companies, however, National Century didn’t actually purchase receivables, Bily said. It just advanced funds. Six companies that were either owned completely or partially by Poulsen and National Century’s two other owners often received such advances, Bily said.

The government has alleged National Century over-funded health-care companies owned by Poulsen and other company principals in a ploy to enrich themselves.

When National Century advanced cash to a health-care company without collateral, Bily said her department made sure to process the requests just as it would legitimate ones so as not to “raise any red flags” with bank trustees who oversaw reserve accounts designed to protect investors. By late 1999 and early 2000, Bily said Poulsen directed her finance department to plug fake numbers into a National Century mainframe computer to make sure that the company’s books remained balanced.

Earlier testimony
Earlier in the morning, both the prosecution and defense finished questioning Jon Beacham, National Century’s former director of securitization.

In testimony last week, Beacham told the jury that he discovered in July 2001 that National Century was advancing cash to health-care providers without buying accounts receivable. That was a violation of the company’s governing documents, and investors were never told that the practice went on, Beacham said.

Under cross-examination Monday morning, Beacham admitted to William Anderson, Poulsen’s attorney, that he never completely told the truth to the government until he signed a plea agreement in 2007. Beacham also acknowledged that when the government indicted him in May 2006, he faced the possibility of serving 30 years or more in prison if found guilty. Because he signed a plea agreement and agreed to cooperate with investigators, Beacham said he now faces 10 years maximum imprisonment, though that time could be reduced further.

“You’re hoping to serve no jail time, is that right?” Anderson asked.

“Of course,” Beacham answered.

Anderson alleged that to have his jail time reduced, Beacham would have to say what the government wanted, a charge Beacham denied.

“I’m here to tell the truth,” he said.