Risk & Compliance

Ebbers Faces Six New Charges

The fresh allegations against the ex-CEO of WorldCom could give prosecutors more flexibility in their case, a lawyer says.
Stephen TaubMay 26, 2004

Lying to securities regulators was one of six charges U.S. prosecutors have added to the case against former WorldCom Inc. Chief Executive Officer Bernard Ebbers.

Ebbers had already pleaded not guilty in March to the prosecution’s charges of fraud, conspiracy, and making false statements in allegations stemming from the telecom giant’s $11 billion accounting scandal.

The plea came shortly after former Chief Financial Officer Scott Sullivan had agreed to cooperate with the government. The new counts against Ebbers allege that he made false filings with the Securities and Exchange Commission in quarterly and annual reports between the company’s fiscal fourth quarter of 2000 and first quarter of 2002, according to Reuters.

The six new counts each carry a sentence of up to 10 years in prison and a $1 million fine, according to USA Today. Under the previous charges, Ebbers reportedly faced up to 25 years and a $2.25 million fine.

Robert Mintz, a lawyer at McCarter & English and a former U.S. prosecutor, told the newspaper that the fresh charges could give prosecutors more flexibility. “They want…the broadest latitude to bring as much evidence as they can and to present alternative theories of prosecution,” he said.

Ebbers is currently free on $10 million bail, secured in part by his $2.5 million house in Mississippi, according to Reuters.