Feeds

Oklahoma AG takes aim at WorldCom, Ebbers

Southern justice

  • alert
  • submit to reddit

Boost IT visibility and business value

Call it WorldCom, MCI or whatever you like. It appears no amount of name changing will help the bankrupt telecommunications company shake its tainted past.

Oklahoma's Attorney General Drew Edmondson has become the latest member of the WorldCom bashing brigade, levying some serious charges against the company and its former executives. The Oklahoma AG is madder than a strapped down steer as a result of WorldCom's past accounting scandals and suspect actions. He joins WorldCom's rivals, some senior citizens and a host of others that want to see the telco pay up for its dark deeds.

Oklahoma claims it is the first to seek criminal charges against WorldCom. It has filed felony charges against the company and former employees, including Chief Executive Officer Bernard Ebbers, Chief Financial Officer Scott D. Sullivan, Controller David F. Myers, Director of General Accounting Buford T. Yates, Jr., Director of Management Accounting Betty L. Vinson and Director of Legal Accounting Troy M. Normand.

"We allege the company and these six employees executed a scheme to artificially inflate the value of WorldCom stock and bonds by intentionally falsifying information filed with the Securities and Exchange Commission," Edmondson said, in a statement. "Securities analysts and the investing public, including the State of Oklahoma, rely on this information when making investment decisions.

"It is rare that we name a company in a criminal complaint, but in this case it is justified. The decision to commit this fraud was a company decision. This is not some rogue employee trying to line his own pockets. This was a conscious decision made for the benefit of the company."

Them be fighting words.

The Oklahoma AG reckons that state pension funds dropped by tens of millions of dollars due to WorldCom's collapse. The fine people of Oklahoma suffered as well.

For its $11 billion accounting scandal, the SEC ordered WorldCom to pay $750 million in cash and stock. Numerous organizations argue this wasn't quite enough for a debacle that cost investors close to $200 billion. Go figure.

More AGs may follow Oklahoma with suits of their own.

Under its new MCI monicker, the company has tried to clean house by bringing in new management and setting up more stringent policies for reporting fraud. MCI wants to move away from its past and emerge from bankruptcy later this year with a clean slate.

Good luck. ®

Related Stories

MCI 'on track' to exit Chapter 11
SBC claims MCI not paying dues
FBI snoops around MCI
Church group asks FCC to vet MCI
US bars MCI Worldcom from new federal contracts

The Power of One Brief: Top reasons to choose HP BladeSystem

More from The Register

next story
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.