Criminal Charges Seen for WorldCom
Oklahoma will file criminal charges against WorldCom Inc., and several former executives, including Chief Executive Bernard J. Ebbers, the Wall Street Journal reported late Tuesday on its Web site.
Citing people familiar with the matter, the newspaper said state Atty. General Drew Edmondson will file criminal charges alleging WorldCom, Ebbers and five other company leaders violated the Oklahoma Securities Act.
The state will contend that WorldCom and the six executives willfully presented investors false information about the company, according to the newspaper’s sources.
WorldCom, which plans to change its name to MCI when it emerges from Chapter 11, is moving its headquarters from Mississippi to Virginia.
Edmondson spokesman Charlie Price declined to comment Tuesday on what action the state plans against the company. Edmondson has scheduled a news conference for today to discuss the case.
WorldCom filed the nation’s largest bankruptcy case in July 2002 amid an accounting scandal that has grown to $11 billion.
Several other states already have begun investigating WorldCom. The company also faces a federal criminal investigation and was recently barred from signing new contracts with the U.S. government.
WorldCom is seeking to emerge this fall from Chapter 11 bankruptcy protection, and has faced a fierce campaign from competitors who argue that the company should be liquidated.
In May, Edmondson, attorneys general from West Virginia and Massachusetts, and the Alabama Securities Commission filed objections to court approval of MCI’s disclosure statement to its Chapter 11 reorganization plan.
