WorldCom to face fraud charges

By Alun Williams

Posted on 5 Jul 2002 at 18:15

The fallen giant WorldCom will face charges of securities fraud, with the US Securities and Exchange Commission (SEC) accusing the communications company of improper accounting.

The official process is not imminent, however. The US District Judge Jed Rakoff has set March 31 as the start date for the World Com case, reports Reuters.

The SEC charges WorldCom of covering up more than $1.2bn losses by the improper accounting of $3.85bn in expenses.

Chief Executive of WorldCom, John Sidgmore, has already apologised for the financial scandal that has undermined investor confidence in tech companies and their accounting practices. The move was seen as a bid to shore up the standing of the company in the stock markets, with the CEO attempting to avoid the declaration of bankruptcy and the breaking up of the company.