MCI settles fraud charges in US

MCI, formerly known as WorldCom, will pay a $500m (£306m) civil penalty in a settlement with the US Securities and Exchange...

MCI, formerly known as WorldCom, will pay a $500m (£306m) civil penalty in a settlement with the US Securities and Exchange Commission (SEC) over charges of a massive accounting scandal.

The money will be distributed to the victims of the alleged fraud, including shareholders and bondholders.

The settlement, which is subject to court approval, would resolve all of the SEC's claims against the company.

WorldCom changed its name to MCI as part of a series of major changes since the financial debacle that began last year.

The SEC first filed fraud charges against WorldCom in June 2002.

WorldCom said it would restate its earnings as a result of accounting irregularities totalling almost $4bn in June 2002. It then admitted to a further $3.8bn in mis-statements in August 2002, later increasing the total to more than $9bn in November 2002.

 

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