NEW YORK (CNN/Money) - A who's who of current and former senior executives of WorldCom are expected to testify next week before a House committee looking into alleged accounting fraud at the company.
WorldCom CEO John Sidgmore and former CEO Bernard Ebbers top the list of witnesses expected to be called before the House Financial Services Committee. Michael G. Oxley, an Ohio Republican, released the witness list Friday.
The Securities and Exchange Commission filed fraud charges against the telecom and data-networking services provider after the company revealed that it had misstated $3.8 billion in expenses, which inflated its pretax earnings for the past five quarters.
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WorldCom co-founder and former CEO Bernard Ebbers is among those expected to testify before Congress next week. |
Sidgmore, who took over as CEO of WorldCom last spring year after serving as its vice chairman since 1996, has vowed to keep the company afloat amid speculation that the accounting scandal and a $30 billion debt load will force the it into chapter 11 bankruptcy.
He has vowed to cooperate fully with both internal and external investigations. But so far, government regulators have been harshly critical of the way the company is handling the matter.
The chairman of the Securities and Exchange Commission has derided as "wholly inadequate and incomplete" the company's explanation of the accounting irregularities and suggested that criminal charges "may be too good for the people who brought about this mess."
Ebbers, a WorldCom co-founder who helped to turn it into a major force in the telecom industry, stepped down as CEO in last April amid swirling controversy over $366 million in personal loans WorldCom made to Ebbers at interest rates between 2.2 percent and 7 percent.
Bert Roberts, WorldCom's chairman, also is on the House Financial Services Committee's witness list.
The committee also plans to call Scott Sullivan, WorldCom's former chief financial officer, who was fired after the company revealed the accounting irregularities. David Myers, formerly WorldCom's controller, also is expected to testify.
Melvin Dick, a former partner with Arthur Andersen, WorldCom's former auditor, also is expected to testify as is Salomon Smith Barney telecom analyst Jack Grubman.
Other WorldCom executives and some employees of Arthur Andersen were called to testify before the committee early last week, but two key witnesses who had been scheduled to testify were not called.
Saying that he "became concerned that testimony from these two individuals could potentially compromise other inquiries," Oxley said Cynthia Cooper, the WorldCom accountant who discovered the alleged fraud, and WorldCom's audit committee chairman Max Bobbitt would not be compelled to testify.
Cooper, who confronted Sullivan and brought the matter to Bobbitt's attention, reportedly is aiding a Justice Department criminal investigation of the matter.
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