Chelsea man convicted in HealthSouth fraud

Published 12:00 am Tuesday, December 6, 2005


A federal jury recently returned a special verdict against Hannibal Sonny Crumpler, 45, of Chelsea, requiring him to forfeit some $1.4 million in criminal proceeds he obtained as a result of the $2.64 billion accounting fraud at HealthSouth Corporation.

Crumpler was earlier convicted by the jury of conspiracy to commit securities fraud and submitting false statements to auditors on Nov. 18.

The verdict followed a two-week trial before U.S. District Judge Virginia Emerson Hopkins and about three hours of deliberations.

Fifteen other company executives have previously pled guilty for their roles in the accounting fraud at HealthSouth.

&8220;We are pleased that the jury followed the court’s instructions … and found Crumpler guilty based on the evidence presented,&8221; said U.S. Attorney Alice H. Martin.

Crumpler, was employed at HealthSouth from 1986 until 2000 in various capacities, including controller for an operating division of HealthSouth from 1992 until July 2000.

The jury found Crumpler guilty of conspiring with other HealthSouth executives to fraudulently inflate the company’s operating results and financial condition.

The false and fraudulent entries made to HealthSouth’s books and records added about $2.64 billion in fictitious income to the books and records between 1996 and 2002.

After leaving HealthSouth, Crumpler became the chief financial officer at Source Medical Solutions, a company started by HealthSouth and dependent on HealthSouth for financial support.

The jury also convicted Crumpler of submitting false statements on behalf of HealthSouth to Ernst & Young, while the auditing firm conducted HealthSouth’s 2001 audit. Although Crumpler worked at Source Medical Solutions, he remained on HealthSouth’s payroll until October 2002