WorldCom investors awarded £3.58bn compensation

A US district court has approved a £3.58bn settlement for investors who lost money in the accounting fraud at telecoms provider WorldCom.

A US district court has approved a £3.58bn settlement for investors who lost money in the accounting fraud at telecoms provider WorldCom.

The settlement includes former WorldCom chief executive Bernie Ebbers paying out up to £23.5m from his own assets. Ebbers was jailed earlier this year for 25 years for his part in the scandal.

Ebbers will fund his share by selling his house, his stake in a lumber company, thousands of acres of timberland, a golf course, a marina and other investments.

Other former WordCom executives will also have to compensate investors as part of the settlement, but much of it will come from the assets remaining to the company after it went bankrupt in 2002.

Those being compensated range from small investors to multinational investment firms.

The financial fraud included up to $11bn worth of financial misstatements in WorldCom’s accounts. MCI was created out of Worldcom’s ashes in 2004.

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