Prosecutor says more charges possible in WorldCom case

NEW YORK (AP) _ Federal prosecutors said Wednesday they expect to file new charges and possibly name new defendants in the burgeoning WorldCom accounting investigation. <br><br>Assistant U.S. Attorney

Wednesday, September 4th 2002, 12:00 am

By: News On 6

NEW YORK (AP) _ Federal prosecutors said Wednesday they expect to file new charges and possibly name new defendants in the burgeoning WorldCom accounting investigation.

Assistant U.S. Attorney David Anders told U.S. District Court Judge Barbara Jones that he intends to file another indictment in the case that has already branded five WorldCom executives as conspirators in the largest accounting scandal in U.S. history.

``The government is continuing its investigation,'' Anders said.

Anders spoke during the arraignment of former WorldCom chief financial officer Scott Sullivan and accounting executive Buford Yates Jr.

Both men pleaded innocent. Sullivan remains free on $10 million bail. Yates, who was making his first court appearance, was released on $500,000 bond.

Sullivan and former comptroller David Myers are charged with directing other WorldCom employees to hide $3.8 billion in expenses, allowing the company to misstate earnings by an even greater amount.

At their orders, accounting executives Yates, Betty Vinson and Troy Normand helped carry out the largest corporate accounting scandal in United States history, prosecutors charge.

``Sullivan, Yates, and their coconspirators were able to assure that WorldCom's reported earnings exceeded its actual earnings for the period from October 2000 through April 2002 by approximately $5 billion,'' the indictment said. ``As Sullivan, Myers, Yates, Vinson, and Normand well knew, there was no justification in fact or under generally accepted accounting principles for these entries.''

Court papers filed last week indicate Myers, Vinson and Normand are on the verge of pleading guilty as part of cooperation deals. That increases the pressure on Sullivan to strike a deal with prosecutors and tell them what, if anything, former WorldCom CEO Bernard Ebbers knew about the alleged accounting crimes.

Ebbers' lawyer has said he knew nothing about any misreporting, while Sullivan's lawyer Irv Nathan has said his client was a victim of a ``rush to judgment.''