The Commission stated: "On April 2, 2007, the [SEC] filed civil fraud charges in federal district court against Tenet Healthcare Corporation and its former chief financial officer and co-president, its former chief operating officer and co-president, its former general counsel and chief compliance officer, and its former chief accounting officer for failing to disclose that Tenet's strong earnings growth from 1999 to 2002 was driven largely by its exploitation of a loophole in the Medicare reimbursement system. . . To settle the charges, Tenet agreed to pay a civil penalty of $10 million."

The SEC stated: "From 1999 through 2002, Tenet engaged in an unsustainable strategy to improve its earnings by deliberately exploiting a loophole in Medicare's reimbursement system."

The Court stated: "Defendant Tenet Healthcare Corporation . . . consented to the Court's jursdiction over Defendant and the subject matter of this action; consented to entry of this Final Judgment without admitting or denying the allegations of the Complaint (except as to jurisdiction)."

The SEC stated: "On September 10, 2009, the Commission accepted a settlement offer from Thomas B. Mackey, the former co-president and chief operating officer of Tenet Healthcare Corporation and the sole remaining defendant in an action brought by the Commission on April 2, 2007. . . The Complaint alleges that Mackey, of Kewsick, Virginia, was the principal architect of Tenet's scheme to inflate its earnings by exploiting Medicare's outlier reimbursement regulations, which provided from additional reimbursement to hospitals to cover the additional costs for treating extraordinarily sick patients."