Massive layoffs looming at WorldCom in Tulsa
Wednesday, June 26th 2002, 12:00 am
By: News On 6
Investors and WorldCom employees are reeling after Tuesday night's bombshell, when it was revealed that one of the company's top officials might have committed the biggest accounting fraud in US history.
The telecom giant's Chief Financial Officer is accused of inflating the company's earnings by nearly $4-billion. News on Six business reporter Steve Berg says the 2,000 or so Tulsa WorldCom employees were already worried about layoffs. Now needless to say, they are even more worried. We've talked to several employees who work here.
As you might expect with this kind of thing, there are lots of rumors. The company has said the layoffs will start Friday. But as usual, it's proving difficult to get the company to give an exact number for the Tulsa office.
Employees say they've heard everything from 300 to 600. Obviously, the most immediate worry here in Tulsa is about jobs. But analysts say this scandal is going to have a "huge" impact on investor confidence everywhere. Dave Healey with UBS PaineWebber, "You've got the crisis of confidence where people say if I couldn't believe the numbers on the way down, can I believe the numbers when the economy turns around and they start to come back up, and that's why the market hasn't rallied yet ahead of good earnings numbers that we should be getting in the third and fourth quarter."
Many analysts think that bankruptcy for WorldCom is inevitable. If so, they say it would be the biggest in history, taking over the title from Enron.