“You start cheating because you want to please people,” says Aaron Beam, “you want to deliver good numbers to Wall Street, sometimes the public thinks you just do it because you’re dishonest … but I think in my case, that was pretty far down the list of why I did what I did.”
When Beam founded HealthSouth in 1984, the business was doing well. The company is the largest owner of rehabilitation hospitals in the U.S. and was bringing in consistently good numbers on the New York Stock Exchange. Beam was the CFO – his wealth and reputation were tied up in HealthSouth, and after more than a decade on the job, the market pressures began to feel heavier.
“We were missing our numbers,” he says, “we were not doing as well as we told Wall Street we would do.”
So, “out of fear of disappointing Wall Street, out of fear of losing my wealth … out of not wanting to disappoint other people, employees,” Beam started to cheat, to “cook the books…. You sort of learn to lie, you become evasive.”
His involvement with the scandal lasted about a year before he left HealthSouth. “I found that I couldn’t live with myself, but six years after I left the company, the fraud broke.”
Once the scandal hit the news, Beam turned himself in. He told the truth and plead guilty. He testified in the trial of the sitting CEO, who plead not guilty – and walked away.
“I got three months in federal prison,” he said, “I’m very fortunate that I got only three months.”
The HealthSouth fraud changed Aaron Beam’s life. These days he speaks at conferences about ethical business and has written books, including “Ethics Playbook,” about how to be ethical.
And money is less important to him now than it used to be. “Right now, I’m 71 years old, my health is real important, my marriage survived, I’ve been married 44 years and that’s very important to me,” he said, “Truly, I think I’m happier and more focused and have a better handle on life now than when I was running in the fast-lane, literally making millions of dollars every year.”
To hear Aaron Beam’s full story, listen using the audio player above.
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