Business
Ex-lender gets jail time
NEWS IN BRIEF — Posted July 5, 2004
A federal judge in June sentenced a former executive of National Century Financial Enterprises to four years in jail after she admitted keeping fake books at the now-bankrupt medical accounts receivables financing company.
Sherry Gibson, formerly the executive vice president and chief compliance officer at Dublin, Ohio-based NCFE, pleaded guilty to conspiracy to commit securities fraud in 2003. She admitted she maintained accounting records for the company marked as "actual" and "reported."
It was the first time an executive of the NCFE was sentenced to prison. Gibson also faces a civil lawsuit by the U.S. Securities and Exchange Commission, which is pending.
The Chapter 11 bankruptcy of NCFE in the fall of 2002 caused estimated losses of more than $2 billion for investors. The company before its unraveling had become the largest health care factoring firm, buying the outstanding receivables of financially troubled hospitals, physician practices and nursing homes at a discount.
The company invested heavily in bonds, which prosecutors say were inadequately backed by receivables revenues, and is accused of misleading investors on its financial health through manipulation of accounts.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2004/07/05/bibf0705.htm.
