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More on WorldCom
Just to follow up on this site's earlier discussion of the uncertain reasoning of (now former) WorldCom CFO Scott Sullivan, the New York Times reported Thursday that Sullivan tried to persuade the individual conducting the company's internal audit (the one that ultimately uncovered his $3.8 billion accounting abuse) to delay her review until later in the year.
He didn't, however, try to convince the auditor, Cynthia Cooper, to drop the audit entirely. The Times also reports that Sullivan told WorldCom directors that he intended to "write down" the expenses in question in the second quarter of this year — i.e., subtract them from WorldCom's reported cash flow. No doubt he was thinking, better late than never.
He also must have been thinking long term, hoping it would all work out in the end — especially given that he hadn't sold any of his WorldCom stock in the past two years. But it still doesn't make sense; even if he did succeed in delaying the audit and re-adjusting the accounts, the review would still have uncovered the abuse, and failure to report it would have constituted fraud. I still can't figure how he could possibly not realize this had to come out, sooner or later.
July 6, 2002 1:41 PM
I think most crimes have three steps: best intention, justification, denial.
Posted by rob adams on July 8, 2002 10:42 AM
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