Judge Won't Toss Out WorldCom IndictmentDec 8, 2003 | AP
A federal judge refused Monday to toss out an indictment against Scott Sullivan that accuses the former WorldCom Inc. executive of lying on financial statements to secure more than $4 billion in credit for the company in 2001.
Judge Barbara S. Jones announced her ruling from the bench without elaboration, saying she would issue a written decision later.
She also rejected a request by defense lawyers for a hearing on the issue of pretrial publicity.
Sullivan faces trial Feb. 2 in Manhattan on charges that he lied to secure $4.25 billion in credit for WorldCom, the telecommunications company now called MCI, just a year before it declared bankruptcy.
Sullivan, 41, of Boca Raton, Fla., was chief financial officer at WorldCom when investigators say the company carried out a $9 billion accounting fraud, the largest in U.S. history. He has pleaded innocent to charges he ordered WorldCom accountants to move operating expenses off the books so the company could appear to turn a profit when it was actually losing money.
Sullivan's lawyer suggested he might ask that the trial date be delayed, saying prosecutors have thwarted his efforts to see memos he believes might be valuable to the defense.
Some documents were supposed to be in files that were empty when WorldCom permitted the defense to look at Sullivan's old files in Clinton, Miss., last week, he said.
The lawyer said investigators had gotten to them first.
"These memos are extremely important to our defense," Nathan said.
Assistant U.S. Attorney Bonnie Jonas said prosecutors do not believe the documents were relevant to the case.
Nathan, though, noted that the government got to see the documents before it decided on their relevancy. "We'd like the same opportunities the government had," he said. "We shouldn't be limited to the government's perspective."
The judge set a hearing on the issue for Thursday.
WorldCom filed for bankruptcy in July 2002, citing massive accounting irregularities. The scheme involved falsifying ledgers to record billions of dollars in operating expenses as capital expenses, allowing the company to claim a profit when it was losing money.
Several former executives have pleaded guilty to conspiracy and securities fraud in connection with the company's collapse.