Judge Grants Partial WorldCom Settlement
Agreement With SEC 'A Significant Milestone In Restructuring'Nov 27, 2002 | VNUNet.Com
Disgraced telco WorldCom has partially settled its $9bn fraud case with US regulators after a federal judge approved a deal that will allow the company to emerge from bankruptcy.
The partial settlement will see the continuation of a court-appointed monitor for the company to review its internal accounting.
This role could be expanded to include mandatory accounting and ethics training for accounting staff for the next three years.
US District Judge Jed Rakoff said the agreement included a pledge by WorldCom not to engage in any further fraudulent activity.
The judge will determine at a later date what fine the company should pay. WorldCom's creditors have said that such a penalty would harm bondholders who have already suffered serious losses.
Rival telcos, meanwhile, have pushed for the severest punishment possible.
"This settlement is a significant milestone in WorldCom's restructuring efforts," said John Sidgmore, the company's president.
"Our agreement with the Securities and Exchange Commission provides additional assurance that WorldCom's plan to emerge from bankruptcy remains on schedule," he added.
According to the Financial Times, the partial settlement will have no influence on the criminal and civil proceedings against WorldCom chief financial officer Scott Sullivan, financial controller David Myers and two other executives.