Ouch. Bernie Ebbers, the former head honcho at Worldcom, was yesterday sentenced to prison for his role in the $11bn fraud that led the company to collapse so spectacularly.
And not just given any old prison term, but one of 25 years. Quoth our man in New York, David Teather:
Ebbers, a former milkman and basketball coach, started WorldCom as a telephone reselling service in 1983, building it into one of the leading players of the technology boom as he went on an acquisition spree with Wall Street acting as cheerleader. At its peak in 1999, WorldCom was valued at $180bn and Ebbers was one of a new breed of celebrity chief executive.
Things quickly started to go wrong. As the market began to disappear in 2000, WorldCom began fudging its books, wrongly classifying expenses and inflating revenues, to ensure it met Wall Street targets.
Ebbers resigned in March 2002 amid an accounting investigation. In July of that year WorldCom made the largest ever bankruptcy filing, wiping out billions of dollars of investors' cash and costing thousands of jobs.
Twenty five years is a heavy sentence - and if Ebbers, 63, served it completely, he would be almost 90 by the time he got out of prison - but it does show that there's an increasing judicial strictness towards white collar crimes.
