Charles McCall, former chair of McKesson Corp. and HBO & Company, which McKesson acquired, has been sentenced to 10 years in prison for his role in inflating HBOC's revenue figures before the acquisition, Bloomberg reports.
U.S. District Court Judge William Alsup in San Francisco also levied a $1 million fine against McCall. He did not require restitution payments, saying McKesson could pursue that route in civil court, according to Bloomberg.
A federal grand jury in November 2009 found McCall guilty of five counts of fraud and accounting irregularities. He was acquitted on one count of falsifying records. The charges resulted from securities fraud at HBOC to inflate revenue by prematurely recognizing revenue. Five other HBOC employees previously pleaded guilty to various charges. Jay Lapine, former general counsel at McKesson and HBOC, in November was acquitted of all three charges levied against him.
The scandal broke soon after McKesson acquired the company in early 1999, leading to restatements of financial reports and a loss of 47% in the value of McKesson's stock. Investors lost nearly $9 billion and McKesson later settled shareholder lawsuits for $960 million.
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