Word: enronization
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Dates: during 2000-2009
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...workers. Its stock, which peaked at $64.50 three years ago, stopped trading last Tuesday at 83[cents], having all but wiped out employee retirement accounts. The plunge in WorldCom shares has cost investors upwards of $175 billion--nearly three times what was lost in the implosion of Enron. WorldCom is not yet financially bankrupt, but it's clear that it--like a fat slice of corporate America--has been ethically bankrupt for years. We're only now getting a look at the red ink on the moral balance sheets, and new revelations of malfeasance in one company after another...
...filed fraud charges and is launching an investigation--as is the Justice Department, at least two congressional committees and the state of Mississippi, where WorldCom is based. All current and former employees, along with WorldCom's ex-accounting firm, Arthur Andersen, have been ordered to refrain from Enron-like paper shredding. Investigators are especially eager to hear from WorldCom founder Bernie Ebbers, who resigned as CEO in April, not long after it was revealed that he owed the company $366 million in low-interest loans. Ebbers had worked closely with Sullivan, whose office adjoined the CEO's. Ebbers could...
...Justice Department charged three former bankers in Britain with wire fraud in a $7.3 million scheme involving Enron-related partnerships...
...accounting irregularities at WorldCom are much more than a continuation of a trend. This scandal sharply raises the stakes. When Enron filed for bankruptcy in December, it employed 28,000, of whom 12,600 have been let go. WorldCom employs 80,000 and will eliminate a fifth of those jobs almost immediately. The Enron-stock meltdown wiped out $67 billion of shareholder wealth, less than half what WorldCom investors have lost...
...Chairman Carl Levin of the Senate's Permanent Subcommittee on Investigations (which issued the study) also blasts directors for "failing to acknowledge" their share of the blame for Enron's collapse. A lawyer for the board called the report "very unfair," but it will be welcome news to shareholders seeking billions of dollars in compensation from Enron; they could get a legal boost from the 60-page document. The bipartisan study also raises the likelihood that one-time Enron board members will come under renewed pressure to resign directorships at other major corporations like Lockheed Martin and Qualcomm. Wendy Gramm...