WorldCom
 |
Definition of 'WorldCom'Formerly known as WorldCom, now known as MCI, this U.S.-based telecommunications company was at one time the second-largest long distance phone company in the U.S. Today, it is perhaps best known for a massive accounting scandal that led to the company filing for bankruptcy protection in 2002. WorldCom executives effectively fudged the company's accounting numbers, inflating the company's assets by around $12 billion dollars. The swift bankruptcy that followed led to massive losses for investors. |
 |
Investopedia explains 'WorldCom'WorldCom's bankruptcy filing in 2002 was the largest such filing in U.S. history. The WorldCom scandal is regarded as one of the worst corporate crimes in history, and several former executives involved in the fraud faced criminal charges for their involvement. Most notably, company founder and former CEO Bernard Ebbers was sentenced to 25 years in prison, and former CFO Scott Sullivan received a five-year jail sentence, which would have been longer had he not pleaded guilty and testified against Ebbers. Under the bankruptcy reorganization agreement, the company paid $750 million to the Securities & Exchange Commission in cash and stock in the new MCI, which was intended to be paid to wronged investors. |
Related Definitions
Articles Of Interest
-
The Biggest Stock Scams Of All Time
Where there is money, there are swindlers. Protect yourself by learning how investors have been betrayed in the past. -
Top 8 Ways Companies Cook The Books
Find out more about the fraudulent accounting methods some companies use to fool investors. -
The Ghouls And Monsters On Wall Street
Learn about some of the creepiest cases of fraud and the characters behind them. -
5 Lessons From The World's Biggest Bankruptcies
We can learn of investing strategies by studying previous financial disasters. -
Business Owners: Avoid Enron-esque Retirement Plans
If your business administers a retirement plan, you should recognize what's at stake. -
An Overview Of Corporate Bankruptcy
If a company files for bankruptcy, stockholders have the most to lose. Find out why. -
4 History-Making Wall Street Crooks
Find out how these Wall Street high-rollers landed themselves in hot water. -
Pay Attention To The Proxy Statement
Don't overlook this overview of a company's well-being. -
Top 4 Most Scandalous Insider Trading Debacles
Here we look at some of the landmark incidents of insider trading. -
Handcuffs And Smoking Guns: The Criminal Elements Of Wall Street
From godfathers to perps, familiarize yourself with the "criminal elements" creeping around Wall Street.
Free Annual Reports