Ebbers faces WorldCom court showdown
Trial eagerly awaited
Disgraced former Worldcom boss Bernie Ebbers is due to face criminal charges in a New York court this week following the $11bn (£5.8bn) accounting scandal that rocked the corporate world.
Ebbers is charged with fraud and conspiracy related to the collapse of telcoms outfit WorldCom in July 2002. He retired from WorldCom in April 2002, months before it went titsup.
In March 2004 ex-CFO Scott Sullivan pleaded guilty to similar charges and is co-operating with investigators. His evidence is expected to form part of the prosecution against Ebbers.
The trial against Ebbers was due to kick off in November but was delayed until now to give his defence team more time to prepare its case. According to The Guardian, Ebbers is expected to blame Sullivan for the accounting blackhole.
When details of the accounting scandal first emerged in the summer of 2002, the Securities Exchange Commission (SEC) described the WorldCom disclosures as "improprieties of unprecedented magnitude"
US President George W Bush said at the time: "We will fully investigate and hold people accountable for misleading not only shareholders but employees as well."
Where "egregious practices, such as the one today" are uncovered, said Bush, "we'll go after them."
This month ten former directors of WorldCom agreed to cough up $18m (£9.5m) of their own cash to hsettle a class action lawsuit following the collapse of the telecoms company.
The ten weren't directly involved in the accounting fraud but were named in lawsuits. In total, they will pay $54m (£28.7m) to settle the lawsuit brought by former shareholders. $36m (£19m) will be paid by the directors' insurers with the rest coming from their own pockets.
WorldCom emerged from Chapter 11 bankruptcy protection in April and since changed its name to MCI. ®