Accounting Fraud And The Financial Fraud

1761 Words Mar 31st, 2016 8 Pages
Introduction
WorldCom CEO Bernard Ebbers, former partner said “He didn’t know anything about the long distance or telephone business, but he knew how to read numbers, he was a number cruncher.”(“Inside”) This should have been a warning sign to those investing in the company that Ebbers wasn’t the best choice to run the 2nd biggest telecom company in America. WorldCom was just one of many accounting frauds that took place in the early 2000’s. But unfortunately that trend of dishonest accounting didn’t stop. The reason behind writing this report is to examine the $11 billion accounting fraud the biggest in US history, the collusion between Ebbers and the CFO Scott Sullivan to deceive investors, causing the loss of thousands of jobs and costing investors billions of dollars. Hopefully covering this event thoroughly will make other CEO’s think twice before stealing investors’ money. Getting in over his head: The fraud and the storm that followed
In 1983 Long Distance Discount Services, Inc(LDDS) was founded in Jackson, Mississippi by Bernard Ebbers and Maury Waldron. Through the 1980’s LDDS purchased many of its competitors throughout the southern United States making it one of the largest Telecom companies in the world. In 1995 Ebbers now CEO changed the name of the company to WorldCom and acquired a much bigger firm MCI in 1998 the largest corporate merger in the US (Lyke 2). One year later WorldCom tried to take over Sprint which would have made it the biggest telecom…

More about Accounting Fraud And The Financial Fraud

Open Document