Fraud Trial of Healthcare Receivables Buyer Executive Pushed Back Two Months

The trial of Lance Paulsen, the alleged mastermind of a scheme to defraud investors of health care receivables bonds, has been pushed back to October 1, according to a report by the Columbus Dispatch. 

Paulsen, who was convicted in March of trying to bribe a federal witness in the case, was set to stand trial on August 4 in U.S. District Court in Columbus (“NCFE Founder Paulsen Guilty in Bribery Trial,” March 27). But his attorneys said they needed more time to review boxes of documents the Securities and Exchange Commission used in ruling that JPMorgan Chase was partially to blame for the collapse of National Century Financial Enterprises. When the Dublin, Ohio-based company collapsed in 2002, investors lost nearly $2 billion and at least 275 health-care providers went bankrupt.

According to the Columbus Dispatch report, Chase Bank and Bank One, which later merged into JPMorgan Chase, served as trustee banks for NCFE’s programs.

Federal Judge Algenon L. Marbley rescheduled another NCFE executive’s trial to accommodate Paulsen’s new trial date request. The trial of James K. Happ, who is also charged with fraud, will begin on Dec. 1.

Meanwhile, four of the five other NCFE executives found guilty in March for their part in the company’s collapse will be sentenced next week. The fifth, Rebecca S. Parrett, who prosecutors said was responsible for providing instruction on disbursing funds and preparing NCFE reports, fled and has been the subject of a government search since March 27 ("National Century Convict On the Run," July 2).