ArthroCare to Pay $30 Million Penalty For Role in $400 Million Revenue Scam

Medical device maker ArthroCare Corp. agreed in the U.S. District Court for the Western District of Texas to pay a $30 million penalty as part of a deferred prosecution agreement based on a massive revenue scheme by senior executives that resulted in more than $400 million in shareholder losses (United States v. ArthroCare Corp.).

In a Jan. 7 news release, prosecutors said the company also agreed to implement an enhanced compliance program, and to cooperate in the continuing investigation.

Former ArthoCare Senior Vice Presidents John Raffle and David Applegate previously pleaded guilty to criminal charges based on their ...