Former HealthSouth Corp. president and chief operating officer James P. Bennett was indicted on charges of conspiracy, securities fraud, insider trading and money laundering in connection with the health care concern's $2.64 billion accounting fraud, as its former chief executive Richard Scrushy's criminal trial continued.

Bennett, 47, was charged late last week in a 39-count indictment filed in Birmingham District Court. Bennett worked at HealthSouth from 1991 until 2000 in various capacities, including president and chief operating officer from 1995 until 2000. In 1993, he became a member of HealthSouth's board.

The charges against Bennett come as Scrushy is on trial for charges that include conspiracy, fraud, money laundering, obstruction of justice, perjury, and false corporate reporting in the scheme.

The indictment alleges that from about 1996 to 2003, Bennett and other co-conspirators who were officers and employees of HealthSouth conspired to fraudulently inflate HealthSouth's revenue by about $2.64 billion.

According to the indictment, Bennett signed Forms 10-K and other documents that were filed with the Securities and Exchange Commission that he knew contained false financial information.

Bennett is also charged with making false statements to the company's auditor, Ernst & Young, with making a false statement to the FBI during its investigation regarding his knowledge of efforts to manipulate HealthSouth's stock price, and with insider trading that made him more than $17 million in profits. The indictment also accuses him of money laundering, and seeks the forfeiture of roughly $28 million. If convicted of all the charges, the U.S. Attorney's Office said that Bennett faces a maximum sentence of 350 years in prison and $33 million in fines, in addition to the $28 million forfeiture.

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