NEW YORK (CNN/Money) - Fired WorldCom Chief Financial Officer Scott Sullivan is claiming that ex-CEO Bernie Ebbers knew about the company's questionable accounting, Rep. W.J. "Billy" Tauzin told Lou Dobbs Moneyline Thursday.

Congressional investigators are now poring through five boxes of WorldCom documents delivered to the House Energy and Commerce Committee Thursday. Tauzin, R-La., who heads the committee, said fired WorldCom CFO Sullivan told lawyers conducting an internal investigation at WorldCom, that ex-CEO Bernie Ebbers knew about the company's questionable accounting.

'Sullivan, if you recall, the fired CFO of the company, the guy in charge of financial affairs of the company, admitted to those lawyers that the chairman of the company, Bernie Ebbers, did in fact know that millions of dollars -- hundreds of millions of dollars -- had been moved into capital debt rather than expensing it as ordinary debt of the corporation," Tauzin said.

Sullivan's comments are the first evidence that Ebbers knew about WorldCom's accounting, Tauzin said. WorldCom fired Sullivan once its accounting scandal was made public in June while Ebbers resigned in April.

Earlier this week, both Sullivan and Ebbers appeared before the House Financial Services Committee, another congressional panel that is investigating the WorldCom accounting scandal. Both former WorldCom executives remained silent and invoked their Fifth Amendment right against self-incrimination.

"All we know now is that Sullivan is saying that his boss, the CEO, was at least aware that the books were being cooked," Tauzin said.

For Andersen, WorldCom's auditor during the time it inflated its profits, Tauzin said the accounting firm's name pops up at most of the companies that are failing. "Arthur Andersen was the only one [of the Big 5] that allowed its local auditors to do whatever they thought was right," Tauzin said.

The House committee will present all of its finding to the Department of Justice, Tauzin said.

Meanwhile, WorldCom CEO John Sidgmore has admitted that a bankruptcy filing for the telecom company is looking harder to avoid, a news report said.

WorldCom, which is struggling to survive a $3.8 billion accounting scandal, has been in talks with its lenders over financing that would help it avoid bankruptcy. But now at least two of the four options under consideration involve a Chapter 11 filing, Sidgmore told the Wall Street Journal.

One of the options might involve averting bankruptcy protection, the WSJ said.

Despite repeated attempts, WorldCom (WCOME: down $0.04 to $0.16, Research, Estimates) could not be reached for comment. Sidgmore also could not be reached for comment.

Sidgmore's comments come more than two weeks after the company revealed that it improperly booked expenses as capital spending, allowing it to inflate its revenue and hide loses of $1.2 billion . Sidgmore's comments Thursday represent somewhat of a reversal for the embattled CEO, who earlier this week said bankruptcy was still just an option.

"Sidgmore is gradually being more open to bankruptcy," one banking source told CNN/Money.

Whether or not the Clinton, Miss.-based WorldCom actually does file for Chapter 11 bankruptcy protection is still up to the banks. WorldCom owes $2.65 billion to its more than 20 lenders, which can force the company into bankruptcy, banking sources told CNN/Money. The lenders are only willing to consider providing capital if they can get the loan secured either through bankruptcy or with WorldCom assets, persons said.

The company's banks, headed by Deutsche Bank and Citigroup, are still holding conference calls to discuss the WorldCom situation. WorldCom has about $30 billion in debt, persons said.

The troubled telecom has been trying to find a way to avoid bankruptcy and has held talks with GE Capital, the financing arm of General Electric, to serve as alternate lender, different persons familiar with the situation told CNN/Money.

GE Capital has experience offering debtor-in-possession financing to troubled companies. But GE's talks with WorldCom are considered very preliminary, a person said.

Successive accounting scandals from companies such as Enron Corp., Tyco, Global Crossing and now WorldCom have undermined investor confidence and prompted action by lawmakers, including President Bush. Earlier this week, Bush called for a crackdown on corporate wrongdoing, saying the nation's economy and financial systems depend on it.

But Bush appears to be conflicted. The White House admitted Thursday that Bush borrowed money from oil company Harken Energy Corp. while he was a member of its board, a practice he condemned this week as part of his plan to curb corporate abuse and fraud.

Also, the Justice Department has decided that Dunn Lampton, the U.S. attorney for the Southern District of Mississippi, will no longer be involved in the DOJ probe of WorldCom because he is a shareholder.

Manhattan U.S. Attorney James Comey will now handle the investigation into alleged accounting fraud by WorldCom.

Earlier Thursday, WorldCom said it won't pay a dividend to MCI Group (MCITE: down $0.17 to $0.22, Research, Estimates) shareholders. WorldCom said its board of directors decided to omit the dividend of 60 cents per share of MCI stock scheduled to be paid July 15. Cutting the dividend will save it $70 million, WorldCom said.

The move comes 16 days after WorldCom said it inflated its pretax profits over five quarters by hiding expenses. The Securities and Exchange Commission has filed fraud charges against the company, which has cut 17,000 jobs and vowed to sell assets to stay afloat.

WorldCom also reiterated that each MCI share will be converted into 1.3594 shares of WorldCom stock at the close of regular trading Friday. WorldCom spun off MCI Group, a local and long-distance provider, in 2001.

GE Capital and J.P. Morgan declined comment. Deutsche Bank declined comment. Citigroup could not be reached for comment.