Bernie Ebbers, the disgraced Worldcom boss, will face federal criminal charges after his former boardroom colleague turned supergrass.
Ebbers is charged with fraud and conspiracy related to the collapse of WorldCom in July 2002. Scott Sullivan, ex-CFO, pleaded guilty to similar charges and is co-operating with investigators. Sullivan also agreed to sell his $12m, 10-bedroom house to reimburse victims of the fraud.
Ebbers, who often cited the role of the good Lord in running WorldCom, is charged with conspiracy to commit securities fraud, securities fraud and filing misleading data with SEC. He retired from WorldCom in April 2002, months before its collapse.
Sullivan has accepted a permanent bar on acting as an officer and director of a public company or practising as an accountant. He admitted he was guilty of "engaging in a fraudulent scheme to conceal WorldCom's poor financial performance."
The Commission alleges "that by September 2000, Sullivan and other senior WorldCom executives knew that WorldCom's true operating performance and financial results were materially below the financial guidance they had given to Wall Street analysts and investors."
In July last year WorldCom agreed to pay $750m back to investors.
Click here forthe SEC statement ®