WorldCom grew rapidly in the 1990s through acquisitions, becoming one of the largest telecommunications companies in the US by handling 50% of internet traffic. However, in 2002 it was revealed that WorldCom had fraudulently reported $3.8 billion in line costs as capital expenditures rather than expenses, with total fraudulent accounting reaching $9 billion. This caused WorldCom's stock price to collapse and the company eventually filed for bankruptcy, though it was later renamed MCI after emerging from bankruptcy. Several WorldCom executives were charged and convicted for their roles in the accounting fraud scandal.

1. WorldCom:Corporate Fraud1

2. WorldCom BackgroundBernieEbbers is the founder of world com.Huge telecommunications company

3. Largest in the U.S.

4. Held responsible for waking up it’s somewhat sluggish industry in the early 90’s2

5. INDUSTRYTelecommunications giant

6. Provided:

7. Internet Services

8. Long Distance and various other phone services for a cheaper price than competitors.3

9. WorldCom’sAscensionWorldCo­m took the telecom industry by storm when it began a frenzy of acquisitions in the 1990s.

10. From 1995 until 2000, WorldCom purchased over sixty other telecom firms. In 1997 it bought MCI for $37 billion.

11. WorldCom moved into Internet and data communications, handling 50 percent of all United States Internet traffic and 50 percent of all e-mails worldwide.

12. By 2001, WorldCom owned one-third of all data cables in the United States. In addition, they were the second-largest long distance carrier in 1998 and 2002.4

13. THE SCANDALThey classified over $3.8billion in payments for line costs as capital expenditures rather than current expenses.Irregularities in the reserve accounts. SEC claims that the total for fraudulent accounting comes to $9 billion dollars.5