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Former WorldCom exec pleads guilty

Just following orders, claims David Myers

John Geralds in Silicon Valley, vnunet.com 27 Sep 2002

WorldCom's former controller, David Myers, has pleaded guilty to three charges of securities fraud in connection with the $7bn accounting scandal at the telecoms company.

Myers pleaded guilty to securities fraud, conspiracy to commit securities fraud, and filing false information with the US Securities and Exchange Commission.

He told New York District Judge Richard Casey that, on the instruction of senior management, he falsified WorldCom's financial statements between October 2000 and June 2002, by hiding costs to make the company appear more healthy.

The controller resigned from WorldCom on 25 June, the same day on which the company said that it had overstated five quarters of financial results by hiding $3.8bn in costs. WorldCom later expanded its financial restatements to about $7bn.

The guilty plea is the first in the government's probe of the WorldCom scandal. While Myers did not name names, he has agreed to detail the depth of the deception conducted by WorldCom executives above him.

Prosecutors said a few weeks ago that they were continuing their investigation into the accounting misstatements and expected more charges to be brought.

The judge set a tentative trial date of 26 December.

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