EX-WorldCom CEO Criminal Charges. Former WorldCom CEO Bernard Ebbers was booked Wednesday on charges of violating Oklahoma securities laws, the first criminal charges against Ebbers resulting from the accounting scandal that plunged the long-distance giant into bankruptcy.
Ebbers was released after booking, pending an afternoon court appearance, said Oklahoma County Sheriff’s Sgt. Rochelle Thompson.
He and five other former officials with the telecommunications giant, now known as MCI, are accused of 15 felony counts, each carrying up to a 10-year prison sentence and $10,000 fine. The company was also charged.
The charges were brought by Oklahoma Attorney General Drew Edmondson, who said false information on company documents led to Oklahoma investors losing millions, including a $64 million hit taken by state pension funds invested in the company.
massive accounting fraud
Oklahoma’s effort to prosecute Ebbers and other former WorldCom executives has vexed federal agencies, which worry that the state’s case could undermine their own pursuit of the company over its massive accounting fraud.
Former WorldCom Chief Financial Officer Scott Sullivan, for example, has already been charged in federal court and is now named in the Oklahoma complaint.
Oklahoma also charged former executives David Myers, Buford Yates Jr., Betty Vinson and Troy Normand, who have pleaded guilty to federal charges and are helping federal prosecutors. Ebbers has not been charged in federal court.
U.S. Attorney James Comey in New York has expressed concern that the Oklahoma charges could interfere with federal actions. And the Securities and Exchange Commission has said it was “disappointed” by the state action.
Edmondson has said he would cooperate with federal officials but intended to press his case because Oklahoma laws were broken.
Ebbers’ attorney Reid Weingarten said Ebbers should be exonerated.
WorldCom’s collapse last year in an $11 billion accounting scandal was the nation’s largest bankruptcy and part of a wave of scandals to rock corporate America in the last two years.
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