National Century Convict On the Run

The disgraced leaders of health care debt buyer National Century Financial Enterprises will face a judge later this month to learn their fate for bilking investors out of billions. But one defendant may be missing.

Dublin, Ohio-based NCFE once provided financing to hospitals and other health care providers by buying their accounts receivable and issuing securities backed by the purchases. The business model worked until in 1998 NCFE began loaning millions to health care providers where it had built an ownership stake, failed to formalize the loans, then juggled the money in various accounts and lied to investors and others about their holdings. NCFE may have defrauded investors out of as much as $2 billion.

In March five top NCFE executives were convicted of conducting a money laundering scheme that involved selling asset-backed notes and bonds to institutional investors (“Hospital Debt Buyers Convicted of Fraud and Money Laundering,” March 17).

About two weeks after the convictions, one of the executives failed to show for a court appearance. Rebecca S. Parrett, who prosecutors said was responsible for providing instruction on disbursing funds and preparing NCFE reports, has been the subject of a government search since March 27, according to a Columbus Business First news report.

Parrett, a 59-year-old resident of Carefree, Ariz., faces up to 75 years in prison and $2.5 million in fines after being found guilty of conspiracy, money laundering, securities and mail fraud. Prosecutors had asked Judge Algenon L. Marbley to take the five defendants into custody immediately after the guilty verdict, arguing they were a flight risk. However, Marbley allowed Parrett and NCFE’s Chief Financial Officer Donald H. Ayers to remain free under house arrest. James E. Dierker, Jr., Roger S. Faulkenberry, and Randolph H. Speer were ordered to wear electronic monitors until sentencing.

Sentencing hearings for Ayers, Dierker, Faulkenberry and Jon A. Beacham, another NCFE executive convicted in the company’s demise, are scheduled for July 21 to July 23. A fraud trial for Lance K. Poulsen, NCFE’s former president, is set for Aug. 4. Poulsen has already been convicted of bribing a federal witness in another case related to NCFE fraud (“NCFE Founder Poulsen Guilty in Bribery Trial,” March 27).