Executive Lived in `Lap of Luxury' on Lam, Marshal Says

Rebecca Parrett, a former National Century Financial Enterprises Inc. executive who fled the U.S. to avoid a 25-year prison term, was arrested in a Mexican resort town where she liked to dance, a U.S. official said.

Parrett, 62, was picked up yesterday by Mexican immigration authorities in Ajijic, Jalisco, Deputy U.S. Marshal Brian Babtist said today. Parrett was convicted in Columbus, Ohio, in March 2008 for her role in a $2.9 billion fraud. Days later, while out on bail, she fled her home in Carefree, Arizona. She was declared a fugitive and sentenced in absentia in March 2009.

“She was living in the lap of luxury,” Babtist said in a telephone interview from Columbus. “She was having fun, telling people that she was an American who had testified against several people in a large white-collar crime case. She was trying to stay anonymous and using an alias.”

Parrett was flown yesterday from Guadalajara to Los Angeles, where she was arrested on a warrant, he said.

U.S. Magistrate Judge Jacqueline Chooljian, at a hearing today in federal court in Los Angeles, ordered Parrett to be detained and transferred to Columbus. Parrett, who was represented by a public defender, waived her right to an identity hearing in Los Angeles.

She was convicted with four other executives in 2008 of fraud, money laundering and conspiracy. She was also ordered to pay $2.38 billion in restitution. Parrett, a former vice chairman, secretary and treasurer, was one of 10 executives who were convicted at trial or pleaded guilty.

Anti-Aging Treatments

“I’ve heard that she liked to go out dancing,” Babtist said. “She was getting treatments from a Mexican anti-aging doctor regularly. For somebody who’s on the run, it was pretty good.”

Agents had long suspected that Parrett was in Mexico, Babtist said. “It was a matter of narrowing down the search and actually pinpointing the location,” he said.

Ajijic is on the north shore of Lake Chapala.

“The Marshals Service has followed all leads and devoted countless hours to the search for Parrett,” Carter M. Stewart, the U.S. attorney for the Southern District of Ohio, said in a statement.

In July, Parrett’s sister, Linda Case, was sentenced to six months in prison followed by eight months of home confinement for lying to authorities about her whereabouts.

Unpaid Bills

National Century, based in Dublin, Ohio, helped hospitals and medical groups raise money by buying their unpaid insurance bills. The company then sold bonds that were supposed to be backed by those receivables. The receivables were often worthless, prosecutors said. The company filed for bankruptcy in November 2002.

National Century’s collapse hastened the bankruptcies of 275 hospitals, clinics and other health-care providers, authorities said. Victims included Pacific Investment Management Co., the world’s largest bond fund. Pimco lost $283 million and Credit Suisse Group AG lost $257 million, prosecutors said.

Former National Century Chief Executive Officer Lance Poulsen, who founded the company, received a 30-year sentence. He has appealed the sentence and conviction.

Parrett, who left her sixth husband in Carefree, was the subject of a multistate search by U.S. marshals. She was featured on the website of “America’s Most Wanted,” News Corp.’s Fox television show about fugitives.

JPMorgan Chase & Co. agreed to pay $425 million in 2006 to settle claims by National Century noteholders in Arizona. The noteholders said JPMorgan and other banks underwrote or were trustees of the notes used to defraud investors.

Babtist couldn’t say how Parrett financed her life on the run. “I don’t know where the money came from, whether she was getting outside help or she was using the stolen funds from the fraud case,” he said.

The case is U.S. v. Poulsen, 06-129, U.S. District Court, Southern District of Ohio (Columbus).

To contact the reporter on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net.

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