MCI close to settlement with SEC
Troubled telecoms company MCI could announce as early as today that it has reached a settlement with the Securities and Exchange Commission over charges against it relating to accounting fraud.
The company, formerly known as WorldCom, needs to complete its settlement with the SEC, which was partially agreed last autumn, in order to continue with its plan to emerge from Chapter 11 protection from bankruptcy. Any forthcoming announcement will clarify how large a fine MCI must pay for the fraud and the amount is thought to be much larger than any company has previously paid.
The SEC charged WorldCom with accounting fraud after a $3.8bn hole in its accounts was reported due to deliberate misreporting of regular line items such as capital expenditure.