WorldCom charges expand
WASHINGTON -- The government on Tuesday expanded its civil fraud charges against WorldCom and the company raised its estimate of inflated earnings to more than $9 billion in one of the most stunning accounting scandals of the year.
The Securities and Exchange Commission announced that it had broadened the scope of its civil fraud charges, originally filed against the telecom company in June, to include an additional charge and to allege that WorldCom misled investors starting at least as early as 1999 through the first quarter of this year.
WorldCom is in settlement talks with the SEC.
The nation's second-largest long-distance carrier said it told the SEC during those discussions that it expects an additional earnings restatement that could bring the total hole in its books to more than $9 billion.
WorldCom announced $4 billion in financial misstatements in late June. That estimate was later raised by the company to around $7 billion.
The company said Tuesday that the additional restatements "have no impact on its ability to continue to provide service" or to emerge from bankruptcy protection, which it expects to do in mid-2003.