Richard Scrushy had been facing multiple counts of financial fraud including money laundering, securities fraud, and conspiracy when a jury of his peers found him not guilty of engineering one of the biggest corporate fraud cases in American history.
But while Scrushy walked out of the courtroom a free man after a dramatic trial that captivated the nation, it wouldn’t be for long before he ended up in prison.
Just four months after the acquittal, Scrushy was indicted on new charges of bribery, conspiracy to commit honest services mail fraud, and four counts of honest services mail fraud after the federal government accused the former HealthSouth chief executive officer of bribing former Alabama Governor Don Eugene Siegelman, according to a statement from the U.S. Department of Justice.
Scrushy was convicted in 2006 and initially sentenced to 82 months, Forbes reports.
The once charismatic CEO left his lavish life of fancy cars, boats, and houses behind and headed to a federal prison — but just where is Scrushy today?
Accusations of Corporate Fraud
Scrushy’s rise and subsequent fall was revisited in an episode of Netflix’s new docuseries “Trial by Media,” which retold the story of the HealthSouth scandal through new interviews with defense attorneys Donald Watkins Sr. and Jim Parkman, along with United States attorney Alice H. Martin and Scrushy himself.
Scrushy had been accused of directing employees at the HealthSouth Corp. to cook the books to make it appear the company was more profitable than it really was under mounting pressure to perform in the stock market.
As the company’s stock prices rose, Scrushy and others “received salaries bonuses, stock options and other benefits some of which were tied, directly and indirectly, to the financial performance of HealthSouth,” according to charging documents in the case.
Scrushy allegedly received approximately $267 million in compensation between 1998 and 2002 from HealthSouth, the healthcare company he had helped found, including stock options that were valued at more than $206 million when they were exercised, the charging documents stated.
Five of the company’s chief financial officers had pleaded guilty in the case and agreed to testify against Scrushy, describing how Scrushy had allegedly encouraged them to alter the company’s financial records.
“No doubt in my mind that Richard Scrushy was guilty of the financial fraud occurring at HealthSouth,” Martin recalled in the docuseries. “We had five CFOs that could tell you what Richard Scrushy had said to them, and they said from the very beginning, when it was on the Nasdaq, that HealthSouth had never reported true numbers.”
Prosecutors focused on the lavish lifestyle Scrushy was able to afford because of the alleged fraud — highlighting his multiple boats, homes, and desire to be a country rock star.
However, Scrushy’s defense team argued that the chief executive officer had been unaware of the activities of his CFOs and called the credibility of the CFOs into question on the stand.
His legal defense team also directed him to win the court of public opinion, which he did by regularly granting interviews to proclaim his innocence and starting his own religious television show to improve his public image, attorney Donald Watkins said in the docuseries.
“(In) high profile cases there are two trials, outside the courthouse and inside. The court of public opinion is very important. That’s the first trial,” Watkins said.
The defense team’s strategy worked and Scrushy was acquitted of all the charges against him on June 28, 2005.
Headed To Prison
But Scrushy wouldn’t be a free man for long. Just months after he was acquitted of the 85 charges against him, he was indicted on new allegations that he had bribed the former Alabama governor.
"When they came out and indicted him for the bribery scandal against the governor, it seemed like a lot of poetic justice," former HealthSouth CFO Weston Smith said in the docuseries.
Scrushy had paid Siegelman $500,000 in laundered funds to obtain a seat on a state regulatory board that governed HealthSouth, according to the statement from the Department of Justice.
He was convicted and sentenced to seven years behind bars — but the multimillionaire would also find himself once again plagued by the HealthSouth allegations.
After reporting to a federal prison, a civil court later found him liable for the HealthSouth fraud and he was ordered to pay $2.8 billion, according to the docuseries.
As part of the civil court finding, he was also barred from leading any publicly traded company.
“They took everything away while I was in prison,” Scrushy said in the docuseries. “They took clothes, they took jewelry, they took college degrees off the wall. They took everything that I had. It was very, very, devastating to us that that could even happen in America.”
While in prison, Scrushy would later tell WIAT that he used his time to teach classes to other inmates, including courses on real estate and business, continued his ministry, and led the praise and worship team inside the prison. He also performed as a musician for the warden at prison benefits and parties.
“I was always very active trying to be the best that I could be,” Scrushy said.
Scrushy maintained good relationships with most of the people he met in prison, he said.
“I didn’t have any problems with anybody. I got along with the leadership. I got along with the people that worked there. I got along with the guards,” he told the local station.
But the most difficult part, he said, was being away from his family and young children.
“I had a 13-year-old son when I went in and he was 18 when I came out. Well, I missed his whole, you know, teenage-hood. That’s bad,” he said, adding that another son had been in diapers when he reported to prison.
Scrushy has nine children and six grandchildren, according to his website.
Scrushy’s sentence was later reduced to 70 months at a re-sentencing hearing after the 11th Circuit Court of Appeals threw out his convictions on honest services fraud, Forbes reported.
Starting Over Again
Scrushy ended his prison sentence on July 25, 2012, after spending a brief period of time in a half-way house and home confinement earlier that year, according to AL.com.
But even after his prison sentence had ended, he continued to maintain his innocence, telling WIAT in 2014 that he wasn’t guilty of the charges he had been convicted of.
“You’ve got to believe there was a reason I was there…because I was not guilty of what I was charged with and everybody knows that. Anybody who has looked at the case knows that but that’s ok. I am not mad at anybody. I am not upset about that. I am not drinking any poison. Bottom line was I said, ‘Ok God, I am here and I’m gonna make the best of this,’” he said.
Scrushy’s family moved from Birmingham to Houston, Texas where he “totally started over again,” he said in the docuseries.
“After five years in prison, you come out and you don’t have a job, you have no income, you have nothing,” he said.
Scrushy is now a small business consultant working in the Houston area.
After his release from prison, Scrushy also wrote the book “When Building a Billion Dollar Company: Here Are a Few Things to Think About,” a book designed to help others build and grow their businesses. He also lists himself as a public speaker on his website.
“He can speak with your group on a practical level of how you can achieve the American dream and he can speak on an inspirational level of what it means to lose the American dream of freedom,” the website states.
As Scrushy continues to rebuild his life after prison, he preaches with his wife, Leslie, according to the docuseries.
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