Sullivan gets five years for WorldCom fraud

Listen to this article

00:00
00:00

Scott Sullivan, former finance chief of WorldCom, was sentenced on Thursday to five years in prison, as a federal judge showed leniency to the “architect” of the $11bn accounting fraud because of his co-operation with prosecutors.

Mr Sullivan's sentence was considerably lighter than the 25 years handed down to Bernie Ebbers, WorldCom's former chief executive, last month.

Mr Sullivan had committed crimes of the “highest magnitude”, Judge Barbara Jones said in federal court in Manhattan, but added: “It was extremely fortunate that there was an opportunity for you to co-operate in this case. You would've faced a substantial sentence had you not co-operated with the government.”

Mr Sullivan, who admitted lesser fraud charges, spent 400 hours working with federal prosecutors and testified for seven days in Mr Ebbers' trial. Prosecutors said his “extraordinary” co-operation had been critical in forming the case against his former boss.

In addition to five years in federal prison, Mr Sullivan will serve three years of “supervised release”.

The judge considered Mr Sullivan's family circumstances - his wife is severely diabetic and they have a four-year-old daughter - in setting his sentence.

Moreover, he is financially ruined from settlements related to the WorldCom frauds.

Choking back emotion, Mr Sullivan read a statement to the court admitting his role in the WorldCom fraud, and apologising to his parents and family. His parents, brothers and sisters and other family were in court.

“I stand before you today ashamed and embarrassed. I deeply regret my actions and apologise for the severe harm they have caused. I am sorry,” he said.

Mr Sullivan's sentencing closes a chapter in one of the federal government's highest-profile cases to crack down on white-collar crime in corporate America.

His sentence was the last of five lower-ranking WorldCom employees handed down this month.

Mr Sullivan is scheduled to surrender to authorities on November 11 to begin his sentence.

Henry Bruen, a former WorldCom employee who lost his job and argued for victims of the fraud, called the judge fair but on Thursday said: “I'm mixed about it. Given all the victims, it was still an inadequate sentence.”

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.