Market Overview

This Day In Market History: WorldCom Fraud Settlement

Share:
This Day In Market History: WorldCom Fraud Settlement

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On this day in 2003, a federal judge approved a $750 million settlement between WorldCom and federal regulators related to the company’s $11 billion accounting fraud.

Where The Market Was: The Dow closed at 9,216.79 and the S&P 500 traded at 1,004.42.

What Else Was Going On In The World: In 2003, the Human Genome Project was completed when scientists successfully sequenced 99% of the human genome. The Space Shuttle Columbia tragically disintegrated upon re-entering the atmosphere, killing all seven crew members on board.

A gallon of gasoline cost $1.83.

Closing The Book On WorldCom: WorldCom was one of the largest and fastest-growing companies during the telecom and internet boom of the late 1990s. The company filed for bankruptcy in 2002 after revealing $11 billion in accounting irregularities. At the time, the WorldCom bankruptcy was the largest in U.S. history.

As part of its bankruptcy, WorldCom was ordered to pay $750 million to the SEC, which was intended to be returned to investors who had been wronged. In 2003, WorldCom changed its name to MCI and moved its corporate headquarters from Clinton, Missippi to Ashburn, Virginia.

In March 2005, WorldCom co-founder and CEO Bernard Ebbers was found guilty of fraud, conspiracy and filing false documents with regulators and sentenced to 25 years in prison.

In January 2006, Verizon Communications Inc. (NYSE: VZ) acquired MCI for $8.5 billion.

 

Related Articles (VZ)

View Comments and Join the Discussion!

Posted-In: this day in market history WorldComEducation General Best of Benzinga