When did the WorldCom scandal start?
Sarah Martinez
Updated on January 09, 2026
June 2002
The fraud was uncovered in June 2002 when the company’s internal audit unit, led by vice president Cynthia Cooper, discovered over $3.8 billion of fraudulent balance sheet entries. Eventually, WorldCom was forced to admit that it had overstated its assets by over $11 billion.
Why did WorldCom hide the loans of CEO Bernard Ebbers?
Ebbers, the former chairman and chief executive of WorldCom, used millions of dollars in loans from the company for purposes that were never properly disclosed to shareholders, including the construction of a new home and gifts and loans to his friends and family, according to an interim report filed by a federal …
Who owns MCI now?
Verizon Communications
MCI Inc./Parent organizations
WorldCom was a leading communications company that was acquired by Verizon Communications in January 2006. Known as MCI at the time of the merger, WorldCom’s network assets are now part of Verizon Enterprise Solutions. WorldCom was originally founded in 1983 as Long Distance Discount Service, Inc.
When did WorldCom buy MCI?
September 15, 1998
On November 4, 1997, WorldCom and MCI Communications announced a $37 billion merger to form MCI WorldCom, making it the largest corporate merger in U.S. history. On September 15, 1998, the merger was consummated, forming MCI WorldCom.
Who went to jail in the WorldCom scandal?
Bernard Ebbers
| Bernard Ebbers | |
|---|---|
| Spouse(s) | Linda Pigott-Smith ( m. 1968; div. 1997) Kristie Webb ( m. 1999; div. 2008) |
| Criminal charge | Securities fraud, conspiracy |
| Penalty | 25-year imprisonment |
| Imprisoned at | Federal Correctional Institution, Fort Worth |
Does MCI exist today?
Verizon’s $6.7 billion acquisition of MCI closes an era in the telecommunications industry. Verizon Communications’ winning $6.7 billion bid for MCI this week closes the latest and likely final chapter in one of the great rebel stories of American business.
Who was the CEO of WorldCom when it failed?
When WorldCom, the telecommunications giant, failed and was put into bankruptcy, the U.S. witnessed one of the largest accounting frauds in history. Former CEO, Bernie Ebbers, 63, was convicted of orchestrating this US$11 billion accounting fraud and was sentenced to 25 years in prison on July 13, 2005.
When did WorldCom change its name to WorldCom?
He grew the company through a series of acquisitions and changed its name to WorldCom in 1995. In 1998, he bought MCI, the nation’s No. 2 long-distance provider behind AT Corp. ( T: Research, Estimates ), for $37 billion.
When did WorldCom become a publicly traded company?
The company expands by following a strategy in which it buys up regional rivals, using LDDS stock as currency. Within 10 years, Ebbers has purchased 30 companies and LDDS sales reach nearly $1 billion. LDDS is renamed WorldCom in 1995. At the time of their first meeting, Grubman is working as a telecom analyst for PaineWebber.
What was the date WorldCom went into bankruptcy?
Aug 19, 2005 7:00 AM PT. When WorldCom, the telecommunications giant, failed and was put into bankruptcy, the U.S. witnessed one of the largest accounting frauds in history.
