Tuesday, December 2, 2008 - 12:34 PM EST
Happ attorney denies client’s involvement in National Century fraud
Business First of Columbus - by Kevin Kemper
While two juries have concluded that National Century Financial Enterprises Inc. engaged in a multiyear fraud, a defense attorney for the last of the company’s executives to stand trial said in opening remarks that his client believed their actions were above board.Opening arguments in the fraud trial of James Happ over Dublin-based National Century’s 2002 collapse began Tuesday morning in U.S. District Court in Columbus. Craig Gillen, attorney for Happ, told jurors they will hear evidence from the government’s star witness that she falsified investor reports and kept multiple sets of books for a fraud that left investors short $2.84 billion when National Century fell into bankruptcy. What the jury won’t hear, Gillen said, is any evidence that Happ had a hand in the wrongdoing.
“Jim Happ never told a lie to any investors. Period,” Gillen said.
The government has accused Happ of a count each of conspiracy and money laundering conspiracy, plus three counts of wire fraud. He has pleaded not guilty to all charges. The former executive vice president at National Century is standing trial on accusations he was part of an executive-level cabal at the medical financing company that defrauded investors for years. Six former executives have been found guilty of fraud and four have pleaded guilty. Happ is the eleventh and final National Century employee to face criminal charges.
A financier for health-care providers like doctors’ offices and hospitals, National Century’s bread and butter was buying accounts receivable from care providers at a discount, then securitizing the receivables into AAA-rated bonds for sale to investors. At its peak, the company employed more than 350 at its office campus in Dublin while recording annual revenue of more than $250 million.
The government has alleged National Century collapsed after running a sophisticated pyramid scheme that fell apart.
In addition to purchasing legitimate accounts receivable, the government alleged National Century funded companies owned by its founders without getting receivables in return, effectively making risky unsecured loans with investor cash. The company charged its clients for those advances, the government has said, which inflated National Century’s revenue and generated bonuses for senior executives.
A government attorney told jurors Tuesday that Happ, as the firm’s chief accountant and head of servicer operations, was responsible for making sure that purchased accounts receivable were eligible. In its July 2007 indictment of eight National Century executives, the government alleged that Happ improperly advanced as much as $5.4 million to a company owned by NCFE founder Lance Poulsen.
The government also accused Happ of ordering a National Century subordinate to remove safeguards on the company’s computer system relative to a health-care provider he planned to join after leaving National Century.
Happ’s trial began Dec. 1 with jury selection. The trial is expected to last most of the month.
Wednesday, December 3, 2008
James K. Happ, 48, formerly a vice president of Dublin-based National Century Financial Enterprises, faces charges of conspiracy, money-laundering con
Happ was in charge of overseeing which accounts receivables were bought by National Century in its final years of business...
Ten executives of the defunct health-care lender have been convicted...
"...federal prosecutors showed that the company advanced billions to health-care companies between 1995 and 2002"
One should ask : "Just prior to arriving at NCFE, where did James K Happ come from?" CFO at (HCA's) Columbia Homecare Group, Inc. (SEC Source) His difficult taks was the 'divestiture' of losing assets. Well , guess where he dumped these?
Go to the 1999 Bankruptcy Case of Medshares, Inc. in Memphis, Tennessee. (On the other side of Nashville--you know where HCA is.)
In 1999, this case was the largest bankruptcy case in the Western District in Tennessee Federal Bankruptcy Court. Low and behold, 2000 the FBI RAIDED NCFE's office in Dublin, Ohio. 2002 company filed bankruptcy.
Some of the largest unsecured loans were given to companies owned wholly or partly by National Century executives.
Happ was "one of the top advancers at NCFE," who approved unsecured loans worth more than $100 million, Assistant U.S. Attorney Doug Squires told jurors yesterday in opening statements.
The advances were no secret, defense attorney Craig A. Gillen countered. They were a common practice known to auditors and rating agencies before Happ started with the company in February 2000 and after he left in the spring of 2002.
His task was to divest the losing Oh and guess what...THE BILLIONAIRE Richard Rainwater is located at the same address as Columbia Homecare Group, Inc.
??? Well, you need to go to another state...TENNESSEE. The largest Bankruptcy case in the hiostory of the . The Medshares ponsi scheme that was ignored.
Fraud trial begins for final company leader
Former vice president accused of approving unsecured loans
Wednesday, December 3, 2008 3:17 AM
By Jodi Andes
THE COLUMBUS DISPATCH
The 11th -- and last -- executive charged in what was dubbed the nation's largest fraud involving a private company went on trial in federal court in Columbus yesterday.
James K. Happ, 48, formerly a vice president of Dublin-based National Century Financial Enterprises, faces charges of conspiracy, money-laundering conspiracy and three counts of wire fraud. He has pleaded not guilty.
The company bought accounts receivables from health-care providers and collected the bills for a fee. Bonds were sold to investors.
Happ was in charge of overseeing which accounts receivables were bought by National Century in its final years of business, which ended with its bankruptcy in 2002. Investors lost more than $2 billion.
Ten executives of the defunct health-care lender have been convicted for their roles in a multibillion-dollar fraud that resulted in the bankruptcies of numerous health-care companies and hurt investors, among them pension funds across the country.
In two previous trials of executives this year, federal prosecutors showed that the company advanced billions to health-care companies between 1995 and 2002 in loans that had no accounts receivable as collateral. The practice was unknown to investors, who were told the bonds were secure.
Some of the largest unsecured loans were given to companies owned wholly or partly by National Century executives.
Happ was "one of the top advancers at NCFE," who approved unsecured loans worth more than $100 million, Assistant U.S. Attorney Doug Squires told jurors yesterday in opening statements.
It was a "staggering misuse of investor money," Squires said.
The advances were no secret, defense attorney Craig A. Gillen countered. They were a common practice known to auditors and rating agencies before Happ started with the company in February 2000 and after he left in the spring of 2002.
Happ then went to work for Tender Loving Care, one of the lender's clients. At that time, National Century's overpaid advances to that company alone totaled about $99 million. After Happ became chief executive of Tender Loving Care, he saw that all the advances from National Century were repaid, Gillen said.
Happ's case is being tried before U.S. District Judge Algenon L. Marbley and is expected to last two to three weeks.
Of the 10 former National Century executives previously convicted, six have been sentenced to terms ranging from four to 15 years in prison.
One, Rebecca S. Parrett, remains at large, having taken off while awaiting sentencing. Former CEO Lance K. Poulsen and two others await sentencing.
jandes@dispatch.com
Ten executives of the defunct health-care lender have been convicted...
"...federal prosecutors showed that the company advanced billions to health-care companies between 1995 and 2002"
One should ask : "Just prior to arriving at NCFE, where did James K Happ come from?" CFO at (HCA's) Columbia Homecare Group, Inc. (SEC Source) His difficult taks was the 'divestiture' of losing assets. Well , guess where he dumped these?
Go to the 1999 Bankruptcy Case of Medshares, Inc. in Memphis, Tennessee. (On the other side of Nashville--you know where HCA is.)
In 1999, this case was the largest bankruptcy case in the Western District in Tennessee Federal Bankruptcy Court. Low and behold, 2000 the FBI RAIDED NCFE's office in Dublin, Ohio. 2002 company filed bankruptcy.
Some of the largest unsecured loans were given to companies owned wholly or partly by National Century executives.
Happ was "one of the top advancers at NCFE," who approved unsecured loans worth more than $100 million, Assistant U.S. Attorney Doug Squires told jurors yesterday in opening statements.
The advances were no secret, defense attorney Craig A. Gillen countered. They were a common practice known to auditors and rating agencies before Happ started with the company in February 2000 and after he left in the spring of 2002.
His task was to divest the losing Oh and guess what...THE BILLIONAIRE Richard Rainwater is located at the same address as Columbia Homecare Group, Inc.
??? Well, you need to go to another state...TENNESSEE. The largest Bankruptcy case in the hiostory of the . The Medshares ponsi scheme that was ignored.
Fraud trial begins for final company leader
Former vice president accused of approving unsecured loans
Wednesday, December 3, 2008 3:17 AM
By Jodi Andes
THE COLUMBUS DISPATCH
The 11th -- and last -- executive charged in what was dubbed the nation's largest fraud involving a private company went on trial in federal court in Columbus yesterday.
James K. Happ, 48, formerly a vice president of Dublin-based National Century Financial Enterprises, faces charges of conspiracy, money-laundering conspiracy and three counts of wire fraud. He has pleaded not guilty.
The company bought accounts receivables from health-care providers and collected the bills for a fee. Bonds were sold to investors.
Happ was in charge of overseeing which accounts receivables were bought by National Century in its final years of business, which ended with its bankruptcy in 2002. Investors lost more than $2 billion.
Ten executives of the defunct health-care lender have been convicted for their roles in a multibillion-dollar fraud that resulted in the bankruptcies of numerous health-care companies and hurt investors, among them pension funds across the country.
In two previous trials of executives this year, federal prosecutors showed that the company advanced billions to health-care companies between 1995 and 2002 in loans that had no accounts receivable as collateral. The practice was unknown to investors, who were told the bonds were secure.
Some of the largest unsecured loans were given to companies owned wholly or partly by National Century executives.
Happ was "one of the top advancers at NCFE," who approved unsecured loans worth more than $100 million, Assistant U.S. Attorney Doug Squires told jurors yesterday in opening statements.
It was a "staggering misuse of investor money," Squires said.
The advances were no secret, defense attorney Craig A. Gillen countered. They were a common practice known to auditors and rating agencies before Happ started with the company in February 2000 and after he left in the spring of 2002.
Happ then went to work for Tender Loving Care, one of the lender's clients. At that time, National Century's overpaid advances to that company alone totaled about $99 million. After Happ became chief executive of Tender Loving Care, he saw that all the advances from National Century were repaid, Gillen said.
Happ's case is being tried before U.S. District Judge Algenon L. Marbley and is expected to last two to three weeks.
Of the 10 former National Century executives previously convicted, six have been sentenced to terms ranging from four to 15 years in prison.
One, Rebecca S. Parrett, remains at large, having taken off while awaiting sentencing. Former CEO Lance K. Poulsen and two others await sentencing.
jandes@dispatch.com
Monday, December 1, 2008
JPMorgan Chase , Citigroup, Goldman Sachs, & Friends
Wednesday, October 29, 2008
Prosecutors try to paint Poulsen as liarBusiness First of Columbus - by Kevin Kemper
Given the chance to cross-examine the former CEO of National Century Financial Enterprises Inc., prosecutors wasted little time in attempting to portray him as a liar with a history of perjury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
Prosecutors try to paint Poulsen as liarBusiness First of Columbus - by Kevin Kemper
Given the chance to cross-examine the former CEO of National Century Financial Enterprises Inc., prosecutors wasted little time in attempting to portray him as a liar with a history of perjury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
$2.84 billion of investor money disappearing, hmmm
Given the chance to cross-examine the former CEO of National Century Financial Enterprises Inc., prosecutors wasted little time in attempting to portray him as a liar with a history of perjury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
$2.84 billion of investor money disappearing, ...
Wednesday, October 29, 2008
Prosecutors try to paint Poulsen as liarBusiness First of Columbus - by Kevin Kemper
Given the chance to cross-examine the former CEO of National Century Financial Enterprises Inc., prosecutors wasted little time in attempting to portray him as a liar with a history of perjury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
Prosecutors try to paint Poulsen as liarBusiness First of Columbus - by Kevin Kemper
Given the chance to cross-examine the former CEO of National Century Financial Enterprises Inc., prosecutors wasted little time in attempting to portray him as a liar with a history of perjury.
Justice Department Attorney Leo Wise began his cross of Lance Poulsen Wednesday afternoon by reminding the 65-year-old former executive, and the jury who will decide Poulsen’s fate, of the oath Poulsen took to tell the truth. Wise and Poulsen then entered into a sometimes contentious back-and-forth over what Poulsen had testified to earlier.
Wise began by asking about testimony Poulsen gave on Tuesday in which he told the jury he had been living in Ross County Jail in Chillicothe for the last year because he had been convicted of obstruction. Wise asked Poulsen if he hadn’t also been convicted of witness tampering. Poulsen replied that he couldn’t remember the specific charges.
“It’s your testimony that (prison) has had a profound effect on your life and you don’t remember the charges?” Wise asked.
Poulsen answered that he remembered it was obstruction and related charges, but couldn’t remember what those related charges were.
Wise then asked Poulsen about a mid-November bond hearing in which U.S. District Judge Algenon Marbley revoked Poulsen’s bond. Poulsen, the founder of National Century, was originally scheduled to stand trial on fraud and money laundering charges late last year. That trial was postponed, however, when the government detained Poulsen on charges that he attempted to bribe a government witness. A separate jury found Poulsen guilty of the charge in March and he was sentenced to 10 years imprisonment.
When Marbley was considering revoking Poulsen’s bond in November because of the witness tampering charges, Poulsen told the court he was employed by a firm called MTL Enterprises. Wise asked Poulsen if it was true that the government discovered a day after the bond hearing that Poulsen hadn’t worked at MTL for over a month. Poulsen said that was correct.
Wise also asked about testimony Poulsen gave on Wednesday in which he said he was not aware of anyone altering books at the company. After Poulsen said he remembered giving that testimony, Wise asked Poulsen if it was his “OK” that was written next to notations on company investor reports that said arbitrary numbers had been plugged in to make the reports compliant.
“It could be my ‘OK,’ I don’t know,” Poulsen said. “The location (on the document) is typically where I put an ‘OK.’ ”
Poulsen, standing trial in U.S. District Court in Columbus on charges that he orchestrated a fraud at National Century that resulted in $2.84 billion of investor money disappearing, will take the stand again Thursday morning. After that, attorneys are expected to make their closing statements to the jury.
JPMorgan Chase & Co., the largest U.S. bank by market value
JPMorgan Chase & Co., the largest U.S. bank by market value, agreed to pay $425 million in 2006 to settle claims by Arizona noteholders. The noteholders said JPMorgan and other banks underwrote or were trustees of the notes used to defraud investors.
Thursday, November 06, 2008
National Century Financial Enterprises CEO Convicted
Last week, multiple news stories described convictions in the case of a remarkable health care fraud, affecting the now bankrupt National Century Financial Enterprises. Let me begin with a description of what the company did, from an article in the Columbus Dispatch:
National Century Financial Enterprises ... began in 1991 to offer financing to small hospitals, clinics, nursing homes and other health-care providers. Using investors' funds, the Dublin company bought the providers' debt and gave them cash to cover expenses. It kept a fee or percentage of what was collected.
Or, as Columbus Business First put it,
A financier for health-care providers like doctors’ offices and hospitals, National Century’s bread and butter was buying accounts receivable from care providers at a discount, then securitizing the receivables into AAA-rated bonds for sale to investors.
At its peak, the company employed more than 350 workers at its office campus in Dublin while recording annual revenue of more than $250 million.
However, prosecutors charged that it was all a huge fraud, per an earlier story in the Columbus Dispatch:
A Dublin-based health-care lender with a good business model was left in ruins -- and owing billions of dollars -- as a result of greed and a shell game played unknowingly by investors.
It's a game that ended only after greed consumed company reserves and investor money dried up. That's the history of National Century Financial Enterprises, federal prosecutor Leo Wise told jurors in closing arguments yesterday in the trial of Lance K. Poulsen, 65, the company's founder and chief executive.
Poulsen has been on trial since Oct. 1 on 13 counts of fraud tied to the company's collapse. Jury deliberations are expected to begin today.
'Ladies and gentlemen, this is a case of staggering fraud,' Wise said. 'It is one of the largest frauds the FBI has ever investigated. The total is over $2 billion.'
Poulsen, again the company's founder and CEO, was convicted, per Columbus Business First,
A federal court jury has found National Century Financial Enterprises’ co-founder Lance Poulsen guilty of directing what the government called the biggest corporate fraud to surface at a privately held U.S. business.
The 65-year-old Poulsen was found guilty on all of the charges facing him – one count each of conspiracy to commit securities fraud, wire fraud and conspiracy to commit money laundering, as well as three counts of money laundering and six counts of securities fraud.
Poulsen was not the only leader of National Century Financial Enterprises who was convicted or pleaded guilty, again per Columbus Business First,
It also was the second time a federal jury found National Century executives guilty of crimes. Five of Poulsen’s co-executives were convicted in March of multiple fraud-related charges. Donald Ayers, Rebecca Parrett, Roger Faulkenberry, Randolph Speer and James Dierker are serving prison terms. Parrett, a co-founder of National Century, disappeared in March before she was scheduled for a court appearance and remains at large.
This was actually not Poulsen's criminal conviction on charges related to the collapse of National Century Financial Enterprises, again from Columbus Business First,
Poulsen heard a guilty verdict earlier this year on a related case. He and associate Karl Demmler were convicted in the witness tampering trial in March after trying to bribe government witness Sherry Gibson into changing her planned testimony. Poulsen was given 10 years in prison and ordered to pay a $17,500 fine on the bribery conviction, but Demmler has yet to be sentenced.
In a foreshadowing of the current worldwide financial crisis, it appears that other, and more widely respected financial institutions got caught up in this mess, per Bloomberg News,
JPMorgan Chase & Co., the largest U.S. bank by market value, agreed to pay $425 million in 2006 to settle claims by Arizona noteholders. The noteholders said JPMorgan and other banks underwrote or were trustees of the notes used to defraud investors.
The National Century Financial Enterprises collapse affected not only investors, but health care providers, again per Bloomberg,
National Century's collapse hastened the bankruptcies of 275 hospitals, clinics, nursing homes and other health-care providers, according to prosecutors and regulators.
So add Lance Poulsen to our rogue's gallery of health care leaders convicted of fraud, corruption, or other white-collar crimes related to their health care leadership roles.
This is yet another case suggesting that something has gone very wrong with the leadership of important health care organizations. That the activities that doomed National Century Financial Enterprises went on for so long, and involved so many of its top leaders, suggest a disastrously unethical corporate culture that seemingly was effectively concealed from both investors and the health care providers with whom the company did business.
Again, this case argues why we need more transparency, accountability, and commitment to ethical principles in the governance of health care organizations. More specifically, and as I have argued before, this case suggests the need for developing a licensure process for leaders of health care organizations. Licensing doctors and health professionals has been going on for a long time. But now leaders of health care organizations, from hospitals to drug companies, have as much if not more influence over health care, and hence the health and safety of patients as do doctors. Yet there are no requirements that leaders of health care organizations have any particular educational background, knowledge, commitment to health care values, or, for that matter, that they have not committed crimes. Given the scope of bad leadership discussed on Health Care Renewal, maybe a licensing process for health care executives would at least ensure that they have not served time in the brig for theft.
Thursday, November 06, 2008
National Century Financial Enterprises CEO Convicted
Last week, multiple news stories described convictions in the case of a remarkable health care fraud, affecting the now bankrupt National Century Financial Enterprises. Let me begin with a description of what the company did, from an article in the Columbus Dispatch:
National Century Financial Enterprises ... began in 1991 to offer financing to small hospitals, clinics, nursing homes and other health-care providers. Using investors' funds, the Dublin company bought the providers' debt and gave them cash to cover expenses. It kept a fee or percentage of what was collected.
Or, as Columbus Business First put it,
A financier for health-care providers like doctors’ offices and hospitals, National Century’s bread and butter was buying accounts receivable from care providers at a discount, then securitizing the receivables into AAA-rated bonds for sale to investors.
At its peak, the company employed more than 350 workers at its office campus in Dublin while recording annual revenue of more than $250 million.
However, prosecutors charged that it was all a huge fraud, per an earlier story in the Columbus Dispatch:
A Dublin-based health-care lender with a good business model was left in ruins -- and owing billions of dollars -- as a result of greed and a shell game played unknowingly by investors.
It's a game that ended only after greed consumed company reserves and investor money dried up. That's the history of National Century Financial Enterprises, federal prosecutor Leo Wise told jurors in closing arguments yesterday in the trial of Lance K. Poulsen, 65, the company's founder and chief executive.
Poulsen has been on trial since Oct. 1 on 13 counts of fraud tied to the company's collapse. Jury deliberations are expected to begin today.
'Ladies and gentlemen, this is a case of staggering fraud,' Wise said. 'It is one of the largest frauds the FBI has ever investigated. The total is over $2 billion.'
Poulsen, again the company's founder and CEO, was convicted, per Columbus Business First,
A federal court jury has found National Century Financial Enterprises’ co-founder Lance Poulsen guilty of directing what the government called the biggest corporate fraud to surface at a privately held U.S. business.
The 65-year-old Poulsen was found guilty on all of the charges facing him – one count each of conspiracy to commit securities fraud, wire fraud and conspiracy to commit money laundering, as well as three counts of money laundering and six counts of securities fraud.
Poulsen was not the only leader of National Century Financial Enterprises who was convicted or pleaded guilty, again per Columbus Business First,
It also was the second time a federal jury found National Century executives guilty of crimes. Five of Poulsen’s co-executives were convicted in March of multiple fraud-related charges. Donald Ayers, Rebecca Parrett, Roger Faulkenberry, Randolph Speer and James Dierker are serving prison terms. Parrett, a co-founder of National Century, disappeared in March before she was scheduled for a court appearance and remains at large.
This was actually not Poulsen's criminal conviction on charges related to the collapse of National Century Financial Enterprises, again from Columbus Business First,
Poulsen heard a guilty verdict earlier this year on a related case. He and associate Karl Demmler were convicted in the witness tampering trial in March after trying to bribe government witness Sherry Gibson into changing her planned testimony. Poulsen was given 10 years in prison and ordered to pay a $17,500 fine on the bribery conviction, but Demmler has yet to be sentenced.
In a foreshadowing of the current worldwide financial crisis, it appears that other, and more widely respected financial institutions got caught up in this mess, per Bloomberg News,
JPMorgan Chase & Co., the largest U.S. bank by market value, agreed to pay $425 million in 2006 to settle claims by Arizona noteholders. The noteholders said JPMorgan and other banks underwrote or were trustees of the notes used to defraud investors.
The National Century Financial Enterprises collapse affected not only investors, but health care providers, again per Bloomberg,
National Century's collapse hastened the bankruptcies of 275 hospitals, clinics, nursing homes and other health-care providers, according to prosecutors and regulators.
So add Lance Poulsen to our rogue's gallery of health care leaders convicted of fraud, corruption, or other white-collar crimes related to their health care leadership roles.
This is yet another case suggesting that something has gone very wrong with the leadership of important health care organizations. That the activities that doomed National Century Financial Enterprises went on for so long, and involved so many of its top leaders, suggest a disastrously unethical corporate culture that seemingly was effectively concealed from both investors and the health care providers with whom the company did business.
Again, this case argues why we need more transparency, accountability, and commitment to ethical principles in the governance of health care organizations. More specifically, and as I have argued before, this case suggests the need for developing a licensure process for leaders of health care organizations. Licensing doctors and health professionals has been going on for a long time. But now leaders of health care organizations, from hospitals to drug companies, have as much if not more influence over health care, and hence the health and safety of patients as do doctors. Yet there are no requirements that leaders of health care organizations have any particular educational background, knowledge, commitment to health care values, or, for that matter, that they have not committed crimes. Given the scope of bad leadership discussed on Health Care Renewal, maybe a licensing process for health care executives would at least ensure that they have not served time in the brig for theft.
thornburg
Richard Rainwater Billionaire buys 13.04 million shares of tma on
11-20-08 on 11-21-08 the preferred deal was done the 13.04 million
was at .45 a share . that is $5,850,000.00 million pocket change for
him but i would say i think he believes in thornburg .and i am sure is
advisers do not make mistakes very often . with that and the heavy
volume hold on to your shares a few more days and i do believe any
thing is possible ,
11-20-08 on 11-21-08 the preferred deal was done the 13.04 million
was at .45 a share . that is $5,850,000.00 million pocket change for
him but i would say i think he believes in thornburg .and i am sure is
advisers do not make mistakes very often . with that and the heavy
volume hold on to your shares a few more days and i do believe any
thing is possible ,
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