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HealthSouth recovers $133 million in suit against investment bank UBS

Birmingham News, October 24, 2008

HealthSouth Corp. continued its winning streak against the regime of former Chief Executive Richard Scrushy, recovering $133 million from an investment bank accused of aiding a massive corporate fraud at the company. UBS, a New York investment bank that sold shares and bonds of the physical therapy company to investors, agreed to pay $100 million cash and forgive $33 million it was owed by HealthSouth. The suit said UBS investment bankers knew HealthSouth faked its books to the tune of $2.6 billion from 1996 through 2002 to boost profits and trigger performance bonuses for top executives. It also says UBS analysts recommended investors buy HealthSouth shares while knowing the stock was being propped up by phony numbers.