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Ebbers deserves jail for life-prosecutors

June 28, 2005

By Martha Graybow and Patrick Fitzgibbons

NEW YORK (Reuters) – Former WorldCom Inc. Chief ExecutiveBernard Ebbers should be jailed for the rest of his life forhis part in an $11 billion business fraud, federal prosecutorsargued in court papers on Tuesday.

If given the maximum sentence next month, Ebbers, 63, couldreceive up to 85 years in prison.

Ebbers was convicted in U.S. District Court in Manhattan inMarch of orchestrating the accounting fraud that drove thetelecommunications company to bankruptcy.

“By any objective measure of the harm caused, Ebbers’conduct was as detrimental to shareholders as that of (AdelphiaCommunications founder) John Rigas,” prosecutors said in theirfiling.

Attorneys for Ebbers had earlier requested leniency, sayingthe one-time milkman is a “decent and honorable man who rosefrom humble beginnings to the highest levels of corporateAmerica.”

Ebbers’ attorneys argued for a sentence “well below thedraconian, life sentence proposed by prosecutors” and cited”serious heart-related illnesses.”

But prosecutors argued that any medical problems Ebbers mayhave could be treated in prison.

GOOD WORKS

Ebbers’ defense team also argued that the formerexecutive’s charitable works and good deeds should lessen hissentence. The government rejected this assertion.

“Although the defendant’s record of good works is laudable,it falls far short of being so extraordinary as to justify adownward departure,” the government wrote. “Most of the goodworks cited by Ebbers … are what one should expect of decent,hard-working people.”

In late May, Federal Judge Barbara Jones delayed sentencinguntil July 13 to allow Ebbers’ attorneys and the prosecutorsmore time to file papers related to the sentencing.

Last week in the same courthouse, stiff prison sentenceswere given to Rigas and his son, Timothy, Adelphia’s former finance chief.

John Rigas was sentenced to 15 years in prison forconcealing loans and stealing millions of dollars. The defensehad asked for a sentence of probation or home confinement. Inthe case of his son, Timothy Rigas was sentenced to 20 years inprison. His attorney had asked for a term of six months.

In the Ebbers case, the government argued for a sentencesimilar to the one given to Rigas and cited examples of otherrecent, lengthy sentences given to business executivesconvicted of crimes.

THE CASE

During his trial, Ebbers spent two days on the witnessstand defending himself against charges that he mastermindedthe accounting fraud at the worldwide telecommunications gianthe had transformed through a series of takeovers beginning inthe early 1980s.

Along the way, Ebbers became widely regarded as a savvyentrepreneur and maverick, cementing his reputation in 1998with the $40 billion purchase of MCI Communications Corp., thelargest corporate acquisition at the time.

Those who knew Ebbers described him as a brusque andexacting executive with a quick temper, known to tossunderlings out of meetings and publicly embarrass them.

Cost-conscious and a stickler for odd details, he went sofar as to count the cars in the parking lots at night in theClinton, Mississippi, headquarters of WorldCom to see how manywere working late and who was going home.

But he could also be a charming and folksy CEO, whopreferred cowboy boots to suits, opened shareholder meetingswith a prayer, ate lunch in the cafeteria and ran a companythat became a Wall Street darling by the late 1990s.

(Additional reporting by Paul Thomasch)




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