The 63 year-old Ebbers now faces a maximum sentence of 85 years in the slammer, although his legal team have said that they will appeal last week’s verdict (see Ebbers Is Appealing).
In the meantime, the victims, WorldCom's investors, are still chasing down all the players that propped up WorldCom and its myth.
Late last week, New York's State Comptroller, Alan Hevesi, and WorldCom underwriter J.P. Morgan Securities agreed to a $2 billion settlement for the firm's role in the largest securities fraud class case action in history.
If the J.P. Morgan settlement and several prior settlements are approved by the courts, some $6,001,600,000 will have been recovered in settlements so far, Hevesi's office says.
The parties to the WorldCom class action suits are listed here.
So what exactly should Ebbers punishment be in all of this? Tell us your thoughts in the poll below:
Elsewhere in the the corporate courtroom, plenty of scandal cleanups continue to proceed.
Last year, for example, Computer Associates International Inc. (CA) (NYSE: CA)’s former CEO Sanjay Kumar and one-time head of worldwide sales Stephen Richards were indicted on securities fraud conspiracy and obstruction charges after an accounting scandal rocked the Islandia, N.Y.-based firm (see CA's Mea Culpa and Kumar Leaves CA).
If convicted on all counts, the former CA execs each face a maximum prison sentence of 100 years.
Jack Grubman, one of the most notorious figures in the telecom bubble burst, never spent a day in jail for his role as an investment banking liason to Worldcom. He was, however, permanently banned from the securities industry and was forced to pay a total of $15 million in his settlement (see Salomon Slammed in Settlement).
Former Global Crossing Holdings Ltd. chief Gary Winnick also never went to jail for his role in living large while leading his company to a crushing bankruptcy. He was ordered to pay $55 million of a $325 million settlement that was reached with Global Crossing investors and former employees. Nearly half of Winnick's settlement, though, was covered by insurance. But the Justice Department and the SEC did not file charges against Winnick himself.
And for those hunting for the next perp-walk, some famous alleged scandal ringleaders are set to stand trial.
Former Enron execs Ken Lay and Jeff Skilling are still waiting for their day in court, which many expect to come early in 2006. And the Securities and Exchange Commission (SEC) recently charged a number of former Qwest Communications International Inc. (NYSE: Q) execs with engaging in “a multi-faceted fraudulent scheme” designed to overstate the Denver-based carrier’s revenues between 1999 and 2002. These include the company’s former co-chairman and CEO Joseph Nacchio (see SEC Charges Former Qwest Execs).
Two former top executives at Tyco International Ltd. -- L. Dennis Kozlowski, the former CEO and Mark Swartz, the former CFO -- are now on trial for grand larceny, securities fraud, and a laundry list of crimes connected to their ex-employer (see Tyco Sues Kozlowski). The Associated Press reports that each man faces up to 25 years in prison for the most serious of the crimes, larceny.
Other telecom scandals of late, and their outcomes, include:
- OSS Chief Convicted of Fraud
- Quattrone Gets 18 Months + $90K Fine
- Three Jailed for Stealing Huawei Secrets
- SEC Details Lucent Fraud Charges
- Plea Bargain for Theft of Cisco Secrets
- Adelphia Offers $300M to Settle With SEC
- Poll Calls for Floggings
— Phil Harvey, News Editor, Light Reading and James Rogers, Site Editor, Next-Gen Data Center Forum