Former WorldCom chief financial officer Mr Scott Sullivan was indicted today on criminal fraud charges, amid signs that other accused company executives would enter a plea bargain with prosecutors.
Unsealed in a federal court in New York, the indictment also named WorldCom's former director of general accounting Mr Buford Yates in connection with hiding billions of dollars of company expenses.
Mr Sullivan's indictment followed the apparent breakdown of negotiations on a plea bargain in which he would have admitted to charges carrying a jail sentence of 10 years or more.
There were, however, indications that WorldCom's former controller David Myers might be on the verge of striking a deal.
Mr Myers (44) was arrested and charged with Sullivan on an earlier criminal complaint, but he was not indicted today and prosecutors filed documents indicating he and two other WorldCom accounting department employees were cooperating with investigators.
Prosecutors are believed to be trying to build a case against Mr Bernie Ebbers, WorldCom's former CEO, who resigned in April.
"My suspicion is that Myers has agreed to plead guilty," said Walter Brown, a former assistant US attorney, suggesting that an agreement could mean leniency in sentencing.
Mr Sullivan and Mr Myers were sacked in late June after WorldCom revealed that it had an unprecedented $3.8 billion of accounting discrepancies that wiped out its 2001 profits. That figure was later revised to show $7.2 billion in improperly booked expenses.
AFP