New charges

By Staff
April 20, 2003
With the company that paid him a multimillion-dollar salary gone, former WorldCom chief financial officer Scott Sullivan was tagged with new charges last week accusing him of lying on financial statements to secure $4.25 billion in credit for the company. Sullivan was already charged with ordering WorldCom accountants to move operating expenses off the books, making the telecommunications giant appear profitable when it was losing money.
He has previously pleaded innocent to the initial charges, which include securities fraud and making false financial filings to government regulators.
Sullivan was CFO at then Mississippi-based WorldCom when investigators say the company carried out a $9 billion accounting fraud, the largest in U.S. history. Court papers said Sullivan was the highest paid CFO in the United States in 1997, receiving $19 million in salary, bonuses and other compensation. Besides his salary, he also made more than $45.3 million by selling WorldCom stock between 1995 and 2000.
The new charges add 120 years to his potential sentence, although the sentence would likely be much less under federal sentencing guidelines if Sullivan were convicted.
Meanwhile, Sullivan, 40, is living in sunny Boca Raton, Fla., free on $10 million bail on the original charges. He had argued to have his trial moved on grounds a New York trial would be an unfair financial burden, but a judge denied his request. His trial is scheduled to begin Sept. 8.
Whether he will beat the rap is anyone's guess, but prosecutors seem to have assembled a very strong case.