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Non-Tech : The Enron Scandal - Unmoderated -- Ignore unavailable to you. Want to Upgrade?

To: Glenn Petersen who wrote (2938)	3/2/2004 10:34:18 AM
From: Glenn Petersen	Read Replies (1) \| Respond to of 3602

Former WorldCom CEO Ebbers Indicted chicagotribune.com By DEVLIN BARRETT Associated Press Writer Published March 2, 2004, 9:14 AM CST WASHINGTON -- Former WorldCom CEO Bernard Ebbers has been indicted on federal charges stemming from the multibillion dollar accounting scandal at the telecommunications giant, a government official said Tuesday. The official, who spoke to The Associated Press on condition of anonymity, said the charges include securities fraud. Attorney General John Ashcroft planned a 1 p.m. news conference in New York to announce the charges, which first were reported late Monday by WNBC-TV. Ebbers' attorney, Reid Weingarten, could not immediately be reached to comment. Ebbers resigned from WorldCom in April 2002, well after its stock price had begun a steady decline and soon after questions began to swirl about the company's finances. Two months later, WorldCom announced it had uncovered nearly $4 billion in hidden expenses -- the beginning of a spiral that would become the largest corporate fraud in U.S. history. The fraud is now estimated at $11 billion. WorldCom filed for bankruptcy July 21, 2002. In a bid to heal its reputation, WorldCom changed its name to MCI last April and moved its headquarters to Ashburn, Va. Four former company executives have pleaded guilty to criminal charges in the Justice Department's fraud investigation and are helping federal prosecutors. In addition, former WorldCom chief financial officer Scott Sullivan and controller David Myers were arrested in August 2002 on charges of securities fraud, conspiracy and filing false statements with the SEC. Another source familiar with the case, who also spoke on condition of anonymity, said Sullivan has been involved in plea negotiations with federal prosecutors and a deal could be announced as soon as Tuesday. A court appearance was scheduled for Sullivan at 11:30 a.m. at the federal courthouse in New York, U.S. Attorney David N. Kelley said. Ebbers and Sullivan were also charged with 15 violations of state securities laws in Oklahoma. They are among six ex-WorldCom employees charged there in an accounting fraud prosecutors say cost state pension funds $64 million. Oklahoma's attorney general dropped criminal charges against Ebbers in November but has said he plans to refile them this year. A WorldCom report released in June said Ebbers fostered a poisonous corporate culture and said he was "aware, at a minimum, that WorldCom was meeting revenue expectations through financial gimmickry." The report, produced by lawyer William McLucas at the request of the company's new board, said Ebbers had been in meetings in which company officials discussed ways to artificially inflate revenue. A second report, by former Attorney General Richard Thornburgh for a bankruptcy judge in New York, described a corporate culture dominated by Ebbers and Sullivan "with virtually no checks or restraints placed on their actions by the board of directors or other management." Last year a federal judge in New York approved a $750 million settlement between WorldCom and the Securities and Exchange Commission, designed to repay investors who lost money in the fraud. WorldCom also has agreed to corporate reforms, including a court-appointed monitor and regular audits. Ebbers and business associates started Long Distance Discount Service two decades ago in Hattiesburg, Miss. For the next 12 years, it snapped up communications companies, including IDB WorldCom, and in 1995 adopted the name WorldCom Inc., with Ebbers as chief executive. WorldCom merged with MCI in 1997 and planned to merge with Sprint in 1999 until the deal was called off. Copyright © 2004, The Associated Press

To: Glenn Petersen who wrote (2938)	3/2/2004 11:27:45 AM
From: Raymond Duray	Read Replies (2) \| Respond to of 3602

Hi Glenn, Reading between the lines, it would appear that someone has gotten to Leslie Caldwell. Just as there is a controversy over the death of former Enron executive, Cliff Baxter, who would have been an extremely dangerous witness against Jeff Skilling or Ken Lay; and just as Max Cleland miraculously landed a place on the Ex-Im Bank Board of Directors just as he was becoming the most vocal critic on the so-called "indepenedent" 9/11 Commission, it appears that the fix is in. We've seen similar patterns out here in the West where whistleblowers on various frauds concerning the USDA Forest Service and illegal timber harvests seem to vanish overnight to appointments across the country. I think Eichenwald has done us a great disservice to the public by not digging deep enough into the shuffle in the prosecutor's office. Does it seem that way to you?