This is questionable: "...hastened the bankruptcies of 275 hospitals, clinics, nursing homes and other health-care providers, ..."
Fraud Case Against National Century's Poulsen Goes to Ohio Jury
By Denise Trowbridge and David Voreacos
Oct. 31 (Bloomberg) -- Jurors began deliberating fraud charges against Lance Poulsen, the National Century Financial Enterprises Inc. founder accused of leading a $2.9 billion fraud before the company's bankruptcy in 2002.
Poulsen, 65, is accused of cheating investors who bought National Century bonds and believed they backed the purchase of unpaid insurance bills from medical providers that needed cash. Prosecutors said Dublin, Ohio-based National Century advanced $2.2 billion to six companies in which Poulsen owned a stake.
Federal jurors in Columbus, Ohio, began weighing fraud, conspiracy, and money-laundering charges this morning after U.S. District Judge Algenon Marbley instructed them on the law last night. Poulsen faces between 30 years and life in prison if convicted. He is already serving 10 years in prison for tampering with a witness against him.
Poulsen testified in his own defense at the trial, which began Oct. 2. He said he never intended to defraud investors, and that all of his actions were permitted by indentures, private-placement memos and other legal documents.
National Century's collapse hastened the bankruptcies of 275 hospitals, clinics, nursing homes and other health-care providers, according to prosecutors and regulators. Victims included investment firms and pension funds such as Pacific Investment Management Co., the world's largest bond fund.
Pimco lost $283 million and Credit Suisse Group AG lost $257 million, Justice Department Trial Attorney Leo Wise told jurors yesterday in closing arguments.
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 case is U.S. v. Poulsen, 06-129, U.S. District Court, Southern District of Ohio (Columbus).
To contact the reporters on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net; Denise Trowbridge in Columbus, Ohiot .
Last Updated: October 31, 2008 10:00 EDT
Friday, October 31, 2008
Thursday, October 23, 2008
"...nation's largest private fraud case ..."
"...chief executive's criminal culpability in the nation's largest private fraud case depended..."
Maybe a look into the 'private' fraudulent financing company will reveal all the PUBLICLY TRADED companies 'DUMPING' their losing entities into NCFE!
Hint: James K Happ
Attorneys battle it out over Poulsen tapes
Alleged bribery of National Century exec at issue
Thursday, October 23, 2008 3:17 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Lance K. Poulsen's recorded conversations were offered as evidence yesterday in his trial in connection with the collapse of his company, National Century Financial Enterprises.
But whether they proved the former chief executive's criminal culpability in the nation's largest private fraud case depended on who was asking the questions.
Peter Anderson, one of Poulsen's defense attorneys, said that the tapes showed Poulsen wasn't trying to bribe Sherry Gibson, a former vice president of the health-care lender, to forget certain facts when testifying against Poulsen.
She's the government's key witness in the fraud case.
Prosecutor Leo Wise used his questioning of FBI Special Agent Jeff Williams to try to show otherwise.
Wise said Poulsen's use of coded language, evident on tapes made by the FBI, along with the use of a middle man in conversations with Gibson and attempts to use phone lines thought to be secure show that Poulsen was trying to conceal the bribe.
Poulsen is being tried in U.S. District Court in Columbus on fraud charges tied to the company's implosion. When Dublin-based National Century filed for bankruptcy in November 2002, investors lost nearly $2 billion.
Poulsen's taped conversations with his friend Karl A. Demmler show that Poulsen believed Gibson got bad advice from her attorney when he advised her to plead guilty in connection with her role in the company's collapse, Anderson said.
In addition, Poulsen never met with Gibson or gave her any money, Anderson noted. Poulsen could be heard on the tape telling Demmler that he didn't want Gibson to lie, the defense attorney pointed out.
Poulsen's own taped statements show he did want Gibson to forget how she plugged investor reports with false numbers, the FBI agent testified.
In return, the National Century founder said he would also loan her money, "but of course that loan never needs to be repaid," Williams said, quoting Poulsen.
Furthermore, Poulsen did tell his attorney that he wanted to help Gibson find a new lawyer, but it's clear Poulsen didn't tell his own attorney everything he was offering to do for Gibson, Williams said.
"Only the three amigos know about the three amigos," Poulsen said on the tapes referring to himself, Demmler and Gibson.
Both Poulsen and Demmler were convicted in March of witness tampering and obstruction of justice in connection with their contacts with Gibson. Poulsen was sentenced to 10 years in prison; Demmler has yet to be sentenced.
The federal prosecution team of Wise, Doug Squires and Kathleen McGovern are expected to rest their case today after presenting one more witness.
jandes@dispatch.com
Maybe a look into the 'private' fraudulent financing company will reveal all the PUBLICLY TRADED companies 'DUMPING' their losing entities into NCFE!
Hint: James K Happ
Attorneys battle it out over Poulsen tapes
Alleged bribery of National Century exec at issue
Thursday, October 23, 2008 3:17 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Lance K. Poulsen's recorded conversations were offered as evidence yesterday in his trial in connection with the collapse of his company, National Century Financial Enterprises.
But whether they proved the former chief executive's criminal culpability in the nation's largest private fraud case depended on who was asking the questions.
Peter Anderson, one of Poulsen's defense attorneys, said that the tapes showed Poulsen wasn't trying to bribe Sherry Gibson, a former vice president of the health-care lender, to forget certain facts when testifying against Poulsen.
She's the government's key witness in the fraud case.
Prosecutor Leo Wise used his questioning of FBI Special Agent Jeff Williams to try to show otherwise.
Wise said Poulsen's use of coded language, evident on tapes made by the FBI, along with the use of a middle man in conversations with Gibson and attempts to use phone lines thought to be secure show that Poulsen was trying to conceal the bribe.
Poulsen is being tried in U.S. District Court in Columbus on fraud charges tied to the company's implosion. When Dublin-based National Century filed for bankruptcy in November 2002, investors lost nearly $2 billion.
Poulsen's taped conversations with his friend Karl A. Demmler show that Poulsen believed Gibson got bad advice from her attorney when he advised her to plead guilty in connection with her role in the company's collapse, Anderson said.
In addition, Poulsen never met with Gibson or gave her any money, Anderson noted. Poulsen could be heard on the tape telling Demmler that he didn't want Gibson to lie, the defense attorney pointed out.
Poulsen's own taped statements show he did want Gibson to forget how she plugged investor reports with false numbers, the FBI agent testified.
In return, the National Century founder said he would also loan her money, "but of course that loan never needs to be repaid," Williams said, quoting Poulsen.
Furthermore, Poulsen did tell his attorney that he wanted to help Gibson find a new lawyer, but it's clear Poulsen didn't tell his own attorney everything he was offering to do for Gibson, Williams said.
"Only the three amigos know about the three amigos," Poulsen said on the tapes referring to himself, Demmler and Gibson.
Both Poulsen and Demmler were convicted in March of witness tampering and obstruction of justice in connection with their contacts with Gibson. Poulsen was sentenced to 10 years in prison; Demmler has yet to be sentenced.
The federal prosecution team of Wise, Doug Squires and Kathleen McGovern are expected to rest their case today after presenting one more witness.
jandes@dispatch.com
Wednesday, October 22, 2008
"...illegally funding some firms ..." Which firms were illegally funded?
Which firms were illegally funded without buying eligible accounts receivable. That resulted in more than $1 billion? Which firms were these? Look at James K Happ! The last indicted executive?
Now this is the big news in this testimony:
'Terpening said it was because National Century couldn’t get a clean audit that it collapsed. Gibson answered that National Century fell apart because it had been illegally funding some firms without buying eligible accounts receivable. That resulted in more than $1 billion that couldn’t be accounted for, which is why Deloitte would not give the firm a clean audit, Gibson said. When that happened, she said, National Century went under because it couldn’t raise money from new investors to pay off old investors.
Terpening also asked Gibson about bank trustees who oversaw lock boxes National Century used to collect accounts receivable. After getting Gibson to admit that the trustees were a watchdog of sorts, he asked Gibson if those trustees had a responsibility to double check reports National Century sent to them.'
After telling jurors about her central role in an alleged $2.84 billion fraud and Lance Poulsen’s attempt at bribery in 2007, Sherry Gibson faced questions Tuesday from a defense attorney determined to pick her story apart.
Gibson, the former executive vice president of compliance at National Century Financial Enterprises Inc., sparred with William Terpening over her knowledge of the firm’s governing documents and Poulsen’s intentions when he contacted her through an intermediary in 2007.
Poulsen is the cofounder and former CEO of Dublin-based National Century, a health-care financing firm that collapsed into bankruptcy in 2002. He is standing trial in U.S. District Court in Columbus on charges he ran a fraud that resulted in billions of investor dollars going missing. He is accused of one count each of conspiracy, wire fraud and money laundering conspiracy, four counts of concealment of money laundering and six counts of securities fraud. He has pleaded not guilty to all the charges.
Earlier in the trial, Gibson told jurors that Poulsen had directed her to alter the company’s books and create fraudulent investor reports so National Century could hide the more than $1 billion in advances it had given to companies owned by Poulsen and others without collateral.
But on Tuesday, Terpening did his best to sow doubt in the minds of jurors. In one exchange, Terpening suggested that because Gibson hadn’t read all of National Century’s governing documents, she didn’t know for sure that the advances the company made were illegal. National Century purchased health-care providers’ accounts receivable in exchange for quick cash, then securitized the debt into AAA-rated bonds for investors.
In another exchange, Terpening attempted to pin the blame for National Century’s collapse on auditors who would not give the company a clean report. National Century needed clean audits on an annual basis from accounting firm Deloitte & Touche LLP if it wanted to issue new bonds. In 2002, however, Gibson said Deloitte would not give National Century a clean bill of health, which resulted in the firm’s unwinding.
Terpening said it was because National Century couldn’t get a clean audit that it collapsed. Gibson answered that National Century fell apart because it had been illegally funding some firms without buying eligible accounts receivable. That resulted in more than $1 billion that couldn’t be accounted for, which is why Deloitte would not give the firm a clean audit, Gibson said. When that happened, she said, National Century went under because it couldn’t raise money from new investors to pay off old investors.
Terpening also asked Gibson about bank trustees who oversaw lock boxes National Century used to collect accounts receivable. After getting Gibson to admit that the trustees were a watchdog of sorts, he asked Gibson if those trustees had a responsibility to double check reports National Century sent to them.Earlier in the day, Terpening also attacked Gibson on her contention that Poulsen attempted to bribe her into changing her testimony in the summer of 2007. Typical of the back-and-forth was this:
“It was very easy for you to act naturally while you were lying?” Terpening asked.
“No it was very hard,” Gibson said.
Or this:
“This was sort of joint effort ... to trap Mr. Poulsen, is that right?” Terpening asked.
“No,” Gibson answered.
Under earlier questioning from the government, Gibson told jurors that Poulsen used a mutual friend, Karl Demmler, as an intermediary. Demmler asked Gibson to have “amnesia” about allegedly fraudulent activity that took place at National Century in exchange for $1 million.
After Demmler extended the bribery offer, Gibson decided to work with the government to secretly record the bribery conversations in an effort to convict Poulsen and Demmler.
On cross examination, Terpening focused on the fact that Gibson never spoke with Poulsen or received any money from him.
“As I’ve previously stated, I never spoke with Mr. Poulsen directly,” Gibson said.
Thanks to testimony and cooperation from Gibson, Poulsen and Demmler were convicted in March by a separate jury of attempting to bribe Gibson.
The fraud trial continues Wednesday with the government expected to call its last witness, then rest its case.
Now this is the big news in this testimony:
'Terpening said it was because National Century couldn’t get a clean audit that it collapsed. Gibson answered that National Century fell apart because it had been illegally funding some firms without buying eligible accounts receivable. That resulted in more than $1 billion that couldn’t be accounted for, which is why Deloitte would not give the firm a clean audit, Gibson said. When that happened, she said, National Century went under because it couldn’t raise money from new investors to pay off old investors.
Terpening also asked Gibson about bank trustees who oversaw lock boxes National Century used to collect accounts receivable. After getting Gibson to admit that the trustees were a watchdog of sorts, he asked Gibson if those trustees had a responsibility to double check reports National Century sent to them.'
After telling jurors about her central role in an alleged $2.84 billion fraud and Lance Poulsen’s attempt at bribery in 2007, Sherry Gibson faced questions Tuesday from a defense attorney determined to pick her story apart.
Gibson, the former executive vice president of compliance at National Century Financial Enterprises Inc., sparred with William Terpening over her knowledge of the firm’s governing documents and Poulsen’s intentions when he contacted her through an intermediary in 2007.
Poulsen is the cofounder and former CEO of Dublin-based National Century, a health-care financing firm that collapsed into bankruptcy in 2002. He is standing trial in U.S. District Court in Columbus on charges he ran a fraud that resulted in billions of investor dollars going missing. He is accused of one count each of conspiracy, wire fraud and money laundering conspiracy, four counts of concealment of money laundering and six counts of securities fraud. He has pleaded not guilty to all the charges.
Earlier in the trial, Gibson told jurors that Poulsen had directed her to alter the company’s books and create fraudulent investor reports so National Century could hide the more than $1 billion in advances it had given to companies owned by Poulsen and others without collateral.
But on Tuesday, Terpening did his best to sow doubt in the minds of jurors. In one exchange, Terpening suggested that because Gibson hadn’t read all of National Century’s governing documents, she didn’t know for sure that the advances the company made were illegal. National Century purchased health-care providers’ accounts receivable in exchange for quick cash, then securitized the debt into AAA-rated bonds for investors.
In another exchange, Terpening attempted to pin the blame for National Century’s collapse on auditors who would not give the company a clean report. National Century needed clean audits on an annual basis from accounting firm Deloitte & Touche LLP if it wanted to issue new bonds. In 2002, however, Gibson said Deloitte would not give National Century a clean bill of health, which resulted in the firm’s unwinding.
Terpening said it was because National Century couldn’t get a clean audit that it collapsed. Gibson answered that National Century fell apart because it had been illegally funding some firms without buying eligible accounts receivable. That resulted in more than $1 billion that couldn’t be accounted for, which is why Deloitte would not give the firm a clean audit, Gibson said. When that happened, she said, National Century went under because it couldn’t raise money from new investors to pay off old investors.
Terpening also asked Gibson about bank trustees who oversaw lock boxes National Century used to collect accounts receivable. After getting Gibson to admit that the trustees were a watchdog of sorts, he asked Gibson if those trustees had a responsibility to double check reports National Century sent to them.Earlier in the day, Terpening also attacked Gibson on her contention that Poulsen attempted to bribe her into changing her testimony in the summer of 2007. Typical of the back-and-forth was this:
“It was very easy for you to act naturally while you were lying?” Terpening asked.
“No it was very hard,” Gibson said.
Or this:
“This was sort of joint effort ... to trap Mr. Poulsen, is that right?” Terpening asked.
“No,” Gibson answered.
Under earlier questioning from the government, Gibson told jurors that Poulsen used a mutual friend, Karl Demmler, as an intermediary. Demmler asked Gibson to have “amnesia” about allegedly fraudulent activity that took place at National Century in exchange for $1 million.
After Demmler extended the bribery offer, Gibson decided to work with the government to secretly record the bribery conversations in an effort to convict Poulsen and Demmler.
On cross examination, Terpening focused on the fact that Gibson never spoke with Poulsen or received any money from him.
“As I’ve previously stated, I never spoke with Mr. Poulsen directly,” Gibson said.
Thanks to testimony and cooperation from Gibson, Poulsen and Demmler were convicted in March by a separate jury of attempting to bribe Gibson.
The fraud trial continues Wednesday with the government expected to call its last witness, then rest its case.
Tuesday, October 21, 2008
“Money laundering is my business on private contracts,” Demmler said. “It’s nobody’s business but mine.”
Note, the $3Billion dollar figure is just what they can prove!
This is BIGGER THAN ENRON!!! Who is following the real money? How much was given to HCA & Family?
Lance Poulsen allegedly offered a potential witness against him up to $2 million to change her testimony, a riveted jury heard Monday morning.
Backed up by secretly recorded tapes of their conversations, Sherry Gibson, a former executive vice president of National Century Financial Enterprises Inc., told jurors that her former boss used an intermediary to try to convince her to lie during Poulsen’s trial on fraud charges. Gibson is the government’s star witness in its case against Poulsen, the former CEO and part-owner of the Dublin-based firm.
Gibson worked her way up from receptionist to senior executive a National Century, becoming a linchpin in the nearly decade-long fraud the government has alleged went on at the company. She told a jury Monday that she participated in what was essentially a massive Ponzi scheme at the company. She pleaded guilty in 2003 to conspiracy to commit securities fraud.
“I pled guilty because I was guilty,” Gibson said. “... I entered a plea agreement to minimize my exposure to prison.”
Gibson spent three years in prison, repaid $420,000 to the government and agreed to cooperate with the Justice Department’s investigation into National Century.
While in prison, Gibson said Karl Demmler, a mutual friend of hers and Poulsen’s, asked her if she would be interested in recovering the money she had paid to the government. Gibson told the jury that she was more interested in moving on with her life.
“If there was a way to reclaim my assets without nullifying, voiding or in any way imperiling my plea agreement, that would be something to check out,” Gibson read from a Jan. 25, 2007, letter she wrote to Demmler. “I have no intention of starting a fight over my current sentence because the alternative is much worse.”
Thinking that the matter was dropped, Gibson told the jury she then met Demmler for dinner after she got out of prison. But Demmler brought up the subject again, she said. Demmler told her that Poulsen thought the government had given Gibson a “raw deal,” she said, and Poulsen wanted to make Gibson “whole.”
“I was somewhat taken aback that I had just been offered a bribe and changed the subject,” Gibson said.
Gibson said she told her attorney about the offer the next day. After a few days, Gibson made an agreement with the government to record any conversations she had with Demmler.
Prosecutors played for the jury the first conversation Gibson recorded between herself and Demmler.
“I told him you would want at least a million bucks,” the jury heard Demmler say. In that same conversation, Demmler also told Gibson that for a 10 percent fee, he would manage all aspects of the money exchange for her.
“Money laundering is my business on private contracts,” Demmler said. “It’s nobody’s business but mine.”
Between June and October 2007, Gibson said she met with Demmler eight times about a possible bribe, as well as receiving several voice messages from him. In each of the recorded conversations, Demmler told Gibson that he was in touch with Poulsen and attempting to work out payments for her.
In one recorded conversation, Demmler even played a voice message Poulsen had left him that Gibson alleged referred to the bribery attempt.
“There are some ways for our friend to recover our friend’s losses,” Poulsen said in the message he left with Demmler.
Under cross-examination, Gibson admitted to Poulsen’s attorney William Terpening that she never spoke with Poulsen directly. Gibson also said she never met with Pouslen or received any money from him.
Terpening also suggested that Demmler’s reliability was questionable by asking Gibson what she knew about his political views. Gibson admitted that Demmler had some “interesting” ideas, including that any federal government taxation is illegal.
When Terpening suggested that Gibson’s only contact with Poulsen in 2007 was through a “crazy” man, Gibson responded that her contact was through an “intermediary” that was well known to both her and Pouslen. She said she couldn’t comment on Demmler’s psychological health because she is not a doctor.
Both Demmler and Poulsen were found guilty in March by a separate jury of attempting to bribe Gibson.
Poulsen is standing trial in U.S. District Court in Columbus on charges he ran a fraud that resulted in as much as $2.84 billion in investor funds going missing after National Century collapsed into bankruptcy in 2002. Poulsen is accused of one count each of conspiracy, wire fraud and money laundering conspiracy, four counts of concealment of money laundering and six counts of securities fraud. He has pleaded not guilty to all the charges.
Defense attorneys are expected to continue their cross examination of Gibson on Tuesday.
This is BIGGER THAN ENRON!!! Who is following the real money? How much was given to HCA & Family?
Lance Poulsen allegedly offered a potential witness against him up to $2 million to change her testimony, a riveted jury heard Monday morning.
Backed up by secretly recorded tapes of their conversations, Sherry Gibson, a former executive vice president of National Century Financial Enterprises Inc., told jurors that her former boss used an intermediary to try to convince her to lie during Poulsen’s trial on fraud charges. Gibson is the government’s star witness in its case against Poulsen, the former CEO and part-owner of the Dublin-based firm.
Gibson worked her way up from receptionist to senior executive a National Century, becoming a linchpin in the nearly decade-long fraud the government has alleged went on at the company. She told a jury Monday that she participated in what was essentially a massive Ponzi scheme at the company. She pleaded guilty in 2003 to conspiracy to commit securities fraud.
“I pled guilty because I was guilty,” Gibson said. “... I entered a plea agreement to minimize my exposure to prison.”
Gibson spent three years in prison, repaid $420,000 to the government and agreed to cooperate with the Justice Department’s investigation into National Century.
While in prison, Gibson said Karl Demmler, a mutual friend of hers and Poulsen’s, asked her if she would be interested in recovering the money she had paid to the government. Gibson told the jury that she was more interested in moving on with her life.
“If there was a way to reclaim my assets without nullifying, voiding or in any way imperiling my plea agreement, that would be something to check out,” Gibson read from a Jan. 25, 2007, letter she wrote to Demmler. “I have no intention of starting a fight over my current sentence because the alternative is much worse.”
Thinking that the matter was dropped, Gibson told the jury she then met Demmler for dinner after she got out of prison. But Demmler brought up the subject again, she said. Demmler told her that Poulsen thought the government had given Gibson a “raw deal,” she said, and Poulsen wanted to make Gibson “whole.”
“I was somewhat taken aback that I had just been offered a bribe and changed the subject,” Gibson said.
Gibson said she told her attorney about the offer the next day. After a few days, Gibson made an agreement with the government to record any conversations she had with Demmler.
Prosecutors played for the jury the first conversation Gibson recorded between herself and Demmler.
“I told him you would want at least a million bucks,” the jury heard Demmler say. In that same conversation, Demmler also told Gibson that for a 10 percent fee, he would manage all aspects of the money exchange for her.
“Money laundering is my business on private contracts,” Demmler said. “It’s nobody’s business but mine.”
Between June and October 2007, Gibson said she met with Demmler eight times about a possible bribe, as well as receiving several voice messages from him. In each of the recorded conversations, Demmler told Gibson that he was in touch with Poulsen and attempting to work out payments for her.
In one recorded conversation, Demmler even played a voice message Poulsen had left him that Gibson alleged referred to the bribery attempt.
“There are some ways for our friend to recover our friend’s losses,” Poulsen said in the message he left with Demmler.
Under cross-examination, Gibson admitted to Poulsen’s attorney William Terpening that she never spoke with Poulsen directly. Gibson also said she never met with Pouslen or received any money from him.
Terpening also suggested that Demmler’s reliability was questionable by asking Gibson what she knew about his political views. Gibson admitted that Demmler had some “interesting” ideas, including that any federal government taxation is illegal.
When Terpening suggested that Gibson’s only contact with Poulsen in 2007 was through a “crazy” man, Gibson responded that her contact was through an “intermediary” that was well known to both her and Pouslen. She said she couldn’t comment on Demmler’s psychological health because she is not a doctor.
Both Demmler and Poulsen were found guilty in March by a separate jury of attempting to bribe Gibson.
Poulsen is standing trial in U.S. District Court in Columbus on charges he ran a fraud that resulted in as much as $2.84 billion in investor funds going missing after National Century collapsed into bankruptcy in 2002. Poulsen is accused of one count each of conspiracy, wire fraud and money laundering conspiracy, four counts of concealment of money laundering and six counts of securities fraud. He has pleaded not guilty to all the charges.
Defense attorneys are expected to continue their cross examination of Gibson on Tuesday.
National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money
But the real question should be: What "PROVIDERS" received the money and why were they chosen? Where does James K Happ come from? Oh yes, Columbia Homecare Group.
HCA & family dumped/sold their losing entities (Homecare)onto NCFE, shortly after the Healthcare Reform Bill passed !
"...National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money..."
"Auditors and ratings agencies were never allowed in the building unescorted and were never told that National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money,"
Audit data falsified, former VP tells court
National Century execs faked case folders, Gibson testifies
Tuesday, October 21, 2008 3:14 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Employees of health-care lender National Century Financial Enterprises developed many ways to circumvent ratings agencies and auditors, the government's key witness said yesterday in the trial of its former leader, Lance K. Poulsen.
Jurors in the federal fraud trial in Columbus also learned from former company Vice President Sherry Gibson that she had been offered a bribe by Poulsen to "develop amnesia."
Poulsen, former chief executive of Dublin-based National Century, is accused of several counts of fraud in the company's 2002 collapse that cost investors close to $2 billion.
In March, Poulsen was convicted of witness-tampering and obstruction charges, with federal prosecutors presenting evidence that Poulsen used Karl A. Demmler, a mutual friend, to offer Gibson a bribe to "forget" information that could be used against Poulsen in the current trial.
However, Poulsen attorney William Terpening questioned yesterday whether his client was involved, given that Gibson didn't talk to Poulsen directly. He also questioned Demmler's mental stability.
After also being convicted of witness-tampering and obstruction charges, Demmler has become increasingly paranoid and has drunk his own urine in jail, Demmler's attorney has said in court documents.
"So, your only contact with Mr. Poulsen was with a crazy guy who thinks the government is out to get him," Terpening said.
Gibson said she hadn't talked to Poulsen directly since before the company collapsed in November 2002. At that time, she was overseeing the company's compliance department and was in charge of handling random audits.
National Century bought accounts receivable from health-care providers to give them operating money. Money for the purchases came from the sale of notes to private investors.
The investors required National Century to undergo audits from rating agencies and auditors. National Century's financial books had been falsified for years, Gibson said, and executives had ways to get around the audits.
For example, she would escort ratings-agency staff members through the building and take them to a National Century processor who had been chosen in advance, Gibson told government attorney Leo Wise.
The processor would have what appeared to be a file of a health-care-company client, but Gibson and others had put in false numbers that concealed the amount of money National Century had advanced the client, she said.
"Oh, here's Nikki. I see she's working on something. Let's see what she is doing," Gibson said, giving jurors an example of the tours. "I made it seem like it was a normal day for these processors."
Auditors and ratings agencies were never allowed in the building unescorted and were never told that National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money, she said.
jandes@dispatch.com
HCA & family dumped/sold their losing entities (Homecare)onto NCFE, shortly after the Healthcare Reform Bill passed !
"...National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money..."
"Auditors and ratings agencies were never allowed in the building unescorted and were never told that National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money,"
Audit data falsified, former VP tells court
National Century execs faked case folders, Gibson testifies
Tuesday, October 21, 2008 3:14 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Employees of health-care lender National Century Financial Enterprises developed many ways to circumvent ratings agencies and auditors, the government's key witness said yesterday in the trial of its former leader, Lance K. Poulsen.
Jurors in the federal fraud trial in Columbus also learned from former company Vice President Sherry Gibson that she had been offered a bribe by Poulsen to "develop amnesia."
Poulsen, former chief executive of Dublin-based National Century, is accused of several counts of fraud in the company's 2002 collapse that cost investors close to $2 billion.
In March, Poulsen was convicted of witness-tampering and obstruction charges, with federal prosecutors presenting evidence that Poulsen used Karl A. Demmler, a mutual friend, to offer Gibson a bribe to "forget" information that could be used against Poulsen in the current trial.
However, Poulsen attorney William Terpening questioned yesterday whether his client was involved, given that Gibson didn't talk to Poulsen directly. He also questioned Demmler's mental stability.
After also being convicted of witness-tampering and obstruction charges, Demmler has become increasingly paranoid and has drunk his own urine in jail, Demmler's attorney has said in court documents.
"So, your only contact with Mr. Poulsen was with a crazy guy who thinks the government is out to get him," Terpening said.
Gibson said she hadn't talked to Poulsen directly since before the company collapsed in November 2002. At that time, she was overseeing the company's compliance department and was in charge of handling random audits.
National Century bought accounts receivable from health-care providers to give them operating money. Money for the purchases came from the sale of notes to private investors.
The investors required National Century to undergo audits from rating agencies and auditors. National Century's financial books had been falsified for years, Gibson said, and executives had ways to get around the audits.
For example, she would escort ratings-agency staff members through the building and take them to a National Century processor who had been chosen in advance, Gibson told government attorney Leo Wise.
The processor would have what appeared to be a file of a health-care-company client, but Gibson and others had put in false numbers that concealed the amount of money National Century had advanced the client, she said.
"Oh, here's Nikki. I see she's working on something. Let's see what she is doing," Gibson said, giving jurors an example of the tours. "I made it seem like it was a normal day for these processors."
Auditors and ratings agencies were never allowed in the building unescorted and were never told that National Century had advanced millions of dollars to health-care providers who had no collateral or means to pay back the money, she said.
jandes@dispatch.com
Monday, October 20, 2008
Instead of focusing on Freddie and Fannie. why don’t you go further?
Take a look at the trial, that has resumed TODAY, 10-20-08, inCOlumbus Ohio? National Century Financial Enterprises , Inc. dubbed by Federal Prosecutors as ‘larger than Enron’ !
Do you have a clue what this is all about? Do you know who the last executive in this trial, James K Happ, is? Or where he came from?
More importantly, who he worked for prior to his employment at NCFE?
Take a look at the trial, that has resumed TODAY, 10-20-08, inCOlumbus Ohio? National Century Financial Enterprises , Inc. dubbed by Federal Prosecutors as ‘larger than Enron’ !
Do you have a clue what this is all about? Do you know who the last executive in this trial, James K Happ, is? Or where he came from?
More importantly, who he worked for prior to his employment at NCFE?
Saturday, October 18, 2008
Missing Executive not on TRIAL...WHY??
WHERE IS JAMES K HAPP?
The ex-Executive of Richard Rainwater's Columbia Homecare Group, NCFE and Med Diversifired! Why does he go last? Who does he know?
National Century's bad loans total $1,297,721,675
Wednesday, October 8, 2008 3:04 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Federal authorities have long asserted that National Century Financial Enterprises' $1.9 billion in losses could largely be blamed on unsecured loans being doled out, one after another.
Yesterday, prosecutors quantified for jurors just what those loans totaled in the last four years of the company's operation -- down to the penny.
National Century executives gave $1,297,721,675.28 in unsecured loans to six companies they either owned or had a significant financial stake in, FBI Special Agent Jeffrey Williams testified yesterday at former Chief Executive Lance K. Poulsen's fraud trial.
There was no collateral to secure the loans, hence, no likelihood that they would be repaid, Williams said.
Poulsen, 65, one of three founders of National Century, is being tried in U.S. District Court in Columbus on fraud charges stemming from the company's November 2002 collapse.
The company's two other founders, Rebecca S. Parrett and Donald H. Ayers, were convicted of fraud in March. Ayers, 72, is serving a 15-year sentence. Parrett disappeared while free on bond and remains at large.
The FBI agent's testimony yesterday came after Judge Algenon L. Marbley suggested that one of Poulsen's defense attorneys, John E. Haller, recuse himself from questioning a witness.
Haller was an attorney for Purcell & Scott, a law firm that represented National Century until the company filed for bankruptcy. He also helped represent Home Healthcare of America, a client of National Century's, when a medical supplier sued Home Health and National Century in 1999.
When Assistant U.S. Attorney Doug Squires announced that he would call Home Healthcare's former Chief Executive Craig Porter as a witness, Marbley said Haller could not cross-examine him because that would be a conflict of interest.
He gave Poulsen's two other defense attorneys two hours to prepare, a time window that did not please Poulsen.
"This is a matter critical to my defense," Poulsen said. "I see how this protects Mr. Porter's rights. But I don't see how this protects my rights, and I'm on trial here."
Marbley ended the discussion, saying, "One of the things the court advised you at the outset was the conflict of Mr. Haller, but you waived that. Now this is a consequence of your waiver."
Porter testified that his company acquired home health-care companies and was owned by a company whose principal shareholders were Poulsen, Ayers and Parrett.
Despite National Century's loans, Home Healthcare still struggled, Porter testified.
"The company was really hemorrhaging cash and struggling as a company. It had a hard time paying its bills," Porter said.
jandes@dispatch.com
The ex-Executive of Richard Rainwater's Columbia Homecare Group, NCFE and Med Diversifired! Why does he go last? Who does he know?
National Century's bad loans total $1,297,721,675
Wednesday, October 8, 2008 3:04 AM
By Jodi Andes
THE COLUMBUS DISPATCH
Federal authorities have long asserted that National Century Financial Enterprises' $1.9 billion in losses could largely be blamed on unsecured loans being doled out, one after another.
Yesterday, prosecutors quantified for jurors just what those loans totaled in the last four years of the company's operation -- down to the penny.
National Century executives gave $1,297,721,675.28 in unsecured loans to six companies they either owned or had a significant financial stake in, FBI Special Agent Jeffrey Williams testified yesterday at former Chief Executive Lance K. Poulsen's fraud trial.
There was no collateral to secure the loans, hence, no likelihood that they would be repaid, Williams said.
Poulsen, 65, one of three founders of National Century, is being tried in U.S. District Court in Columbus on fraud charges stemming from the company's November 2002 collapse.
The company's two other founders, Rebecca S. Parrett and Donald H. Ayers, were convicted of fraud in March. Ayers, 72, is serving a 15-year sentence. Parrett disappeared while free on bond and remains at large.
The FBI agent's testimony yesterday came after Judge Algenon L. Marbley suggested that one of Poulsen's defense attorneys, John E. Haller, recuse himself from questioning a witness.
Haller was an attorney for Purcell & Scott, a law firm that represented National Century until the company filed for bankruptcy. He also helped represent Home Healthcare of America, a client of National Century's, when a medical supplier sued Home Health and National Century in 1999.
When Assistant U.S. Attorney Doug Squires announced that he would call Home Healthcare's former Chief Executive Craig Porter as a witness, Marbley said Haller could not cross-examine him because that would be a conflict of interest.
He gave Poulsen's two other defense attorneys two hours to prepare, a time window that did not please Poulsen.
"This is a matter critical to my defense," Poulsen said. "I see how this protects Mr. Porter's rights. But I don't see how this protects my rights, and I'm on trial here."
Marbley ended the discussion, saying, "One of the things the court advised you at the outset was the conflict of Mr. Haller, but you waived that. Now this is a consequence of your waiver."
Porter testified that his company acquired home health-care companies and was owned by a company whose principal shareholders were Poulsen, Ayers and Parrett.
Despite National Century's loans, Home Healthcare still struggled, Porter testified.
"The company was really hemorrhaging cash and struggling as a company. It had a hard time paying its bills," Porter said.
jandes@dispatch.com
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