How much do you want to bet that money's gone or hidden some place?
I'll take that bet. The money went straight to the banks that originally lent Ebbers the money to buy WCOM stock, loans that were secured by a WCOM guaranty.
BTW, I just got around to reading today's WSJ. The article beginning on page 1 (cont'd on A12 of the eastern ed.) about WCOM covers all the points I made today about the internal audit, board response, Sullivan's rationale, etc. There's also an article (A3 & A12) on the dilemma the banks face. Here's an excerpt:
Even though the bondholders are owed much more than the banks are, the banks may have more short-term influence over the company's immediate fate because Worldcom is in default on the bank loan but not the bonds...
"The banks [would] have to do something for the situation to implode" immediately, said one banker involved in the matter. Demanding immediate repayment, he said, would "cause the whole capital structure to collapse and lead to a [immediate] Chapter 11 filing. But that doesn't improve your position as a bank." Alternatively, the banks could elect to hold off, and provide the company with more money, he said, in exchange for receiving collateral on their loans, which are currently unsecured. That would give the company additional time to attempt to restructure and stay out of bankruptcy.
Pretty much what I've been saying for the last two days. Everyone here should really read these WSJ articles. Infinitely better journalism, BTW, than any of the Reuters, The Street.com, CBS Marketwatch or any other online sources covering this story.
Bob
PS: Wonder who has the movie rights. |
