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WorldCom Accounting Scandal Sends Markets Reeling
LONDON/PHILADELPHIA (Reuters) - Global markets reeled on Wednesday after U.S. long-distance carrier WorldCom Inc. shocked investors with its disclosure of a $3.8 billion accounting scandal, one of the largest in history. WorldCom, the second-biggest U.S. long-distance telecoms group, on Tuesday night fired its Chief Financial Officer Scott Sullivan and said it would restate its results for the last five quarters, erasing all profits from the beginning of 2001. The news further soured investor confidence after such once high-flying companies as energy trading company Enron Corp., telecom giant Global Crossing and conglomerate Tyco International crashed on a lack of accounting transparency. "This is just another nail in the coffin of confidence," said Paul Marsch, a London-based Morgan Stanley telecoms analyst.

posted by West 8:48 AM