2 Former WorldCom Managers Plead Guilty

Two former WorldCom Inc. middle-level managers pleaded guilty Thursday to securities fraud, becoming the third and fourth executives to implicate superiors and help in the government’s probe of alleged accounting fraud at the telephone giant.

WorldCom, the No. 2 U.S. long-distance telephone carrier and one of the world’s leading movers of Internet traffic, filed for bankruptcy protection in July.

Betty Vinson, 47, and Troy Normand, 35, both of Madison, Miss., pleaded guilty to one count of securities fraud and one count of conspiracy to commit securities fraud in federal court in Manhattan. Their plea deals include an agreement to cooperate with prosecutors.

Both defendants are certified public accountants who worked in WorldCom’s general accounting department and assisted in the preparation of financial documents.

Also Thursday, the Securities and Exchange Commission filed a related civil case against Vinson and Normand.

Although the two were middle-level managers, their information is expected to help prosecutors build a case against WorldCom’s former chief financial officer, Scott D. Sullivan, who was indicted on fraud and conspiracy charges. He pleaded not guilty.

Prosecutors previously said the investigation is continuing and others could be charged in the scheme.

Both Normand and Vinson said during their plea hearings that they were ordered to falsify WorldCom financial records by their supervisors in order to inflate WorldCom earnings to meet Wall Street’s expectations and mislead the investing public.

Mississippi lawyer Joseph Hollomon, who represents both defendants, told reporters after the hearings that his clients had voiced their concerns to their superiors.

Both Vinson and Normand were supervised by Buford Yates, WorldCom’s former director of general accounting. On Monday, Yates pleaded guilty to two securities fraud charges and said he had been ordered by his supervisors to falsify financial records.

Yates reported to David Myers, former WorldCom controller. Myers reported to Sullivan.

The charges against Vinson and Normand carry a total possible maximum prison term of 15 years, but they are expected to receive lighter sentences because of their cooperation. Vinson is scheduled to be sentenced Jan. 13 and Normand April 10.