Scrushy Testifies at Civil Trial

BIRMINGHAM, Ala. (CN) - Former HealthSouth CEO Richard Scrushy testified for the first time Wednesday regarding the massive accounting fraud at the company. Scrushy, dressed in a dark business suit with leg shackles, portrayed himself as a victim of the fraud, saying he knew nothing about it until the FBI raid in 2003.

Although plaintiff's witnesses in his civil trial described Scrushy as a micromanager, he blamed the five chief financial officers, who all have pleaded guilty to criminal accounting fraud, for the situation at HealthSouth.

Scrushy said he disciplined some of five CFOs and claims his lawyer suggested that no one involved in the fraud would risk demoting or firing the executives for fear of being turned in.

Shareholders seek $2.6 billion from Scrushy, claiming he abused corporate perks, falsified earnings and spent company money for personal reasons, including breast implants for a member of an all-woman group he backed.

The bench trial is being heard in Jefferson County Circuit Court by Judge Allwin Horn. Scrushy is serving a 7-year prison term in Texas after being convicted of bribing former Alabama Gov. Don Siegelman. He is being lodged at the Shelby County Jail.

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