Washington (Aug. 25, 2004) -- The Securities and Exchange Commission has suspended former HealthSouth executive Kenneth K. Livesay from appearing or practicing before the commission as an accountant.

Livesay consented to the SEC order without admitting or denying any of the allegations. A CPA licensed to practice in the Alabama, Livesay served as assistant controller of HealthSouth Corp. from 1989 until November 1999.

The SEC’s complaint alleged, among other things, that Livesay directed other HealthSouth employees to record fictitious assets on the company’s books that matched generally fraudulent overstatements of income. The SEC said that the fraudulent entries were designed to avoid detection by HealthSouth’s independent auditors.

In June, Livesay was found guilty in an Alabama District Court of one count of conspiracy to commit wire fraud, one count of securities fraud and one count of willfully and knowingly falsifying books and records of HealthSouth. He was sentenced to 60 months of probation (with the first six months in home detention), to pay a $10,000 fine, to forfeit $750,000 and to pay a $200 assessment.

-- WebCPA staff

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