Bernard Ebbers, former WorldCom CEO who went to prison in massive accounting fraud case, is dead

Bernard Ebbers, the former CEO of WorldCom, who went to prison in 2006 for his role in an $11 billion accounting fraud case, has died.

His death Sunday was confirmed by a statement from his daughter Joy Ebbers Bourne. It was released through his attorney, Graham Carner. Ebbers had been granted an early release from prison due to poor health in December after serving just over 13 years of a 25-year sentence. He was 78 years old.

Ebbers was found guilty in 2005 of conspiracy, securities fraud and filing false statements in the case that brought down what was then the nation’s No. 2 long-distance provider. The company eventually went bankrupt, leading to substantial losses for shareholders. Thousands of WorldCom employees lost their jobs and savings. At the time, the bankruptcy was the largest in US history.

In her statement, Ebbers’ daughter said that her father died surrounded by family members. She thanked Valerie Caproni, the federal judge who granted his release, as well as his attorney.

“I know many of the victims of WorldCom opposed Dad’s release. Many also wrote in support of release,” his daughter said in her statement. “Many stockholders and employees lost their investments in the fall of WorldCom. Many of our friends — and many in our family — did too. Thankfully, Judge Caproni agreed with us — keeping Dad in prison, especially in his unexplained and undiagnosed deteriorated condition, would not bring back anyone’s investments. My family and I continue to pray for everyone affected by the fall of WorldCom.”

WorldCom had operated in the retail long distance market under the MCI name, the telecom company it had purchased for $37 billion in 1997. It competed with AT&T, which was at one time the only company that could connect phone calls across the United States. When it emerged from bankruptcy, it shed the WorldCom name and took the name MCI. It eventually was purchased by Verizon for $6.7 billion, in a deal announced just before Ebbers’ conviction.

Prosecutors argued that Ebbers allowed the accounting fraud because he wanted to protect his personal fortune, which consisted mostly of WorldCom stock. In addition, WorldCom had made loans of $400 million to Ebbers.

Ebbers insisted during the trial that he had been unaware of the fraud that was taking place at his company, but Scott Sullivan, the company’s chief financial officer, testified against him during his trial.

A federal jury in New York deliberated for eight days before finding him guilty on all counts against him.

As part of his sentence, Ebbers agreed to give up most of his assets, valued at the time between $25 million and $40 million and pay an additional $5 billion fine. The assets included a mansion in Clinton, Mississippi and his stake in numerous businesses, including a trucking company, marina, golf course, hotel and other real estate ventures.

Ebbers’ attorney filed for his early release last year, saying that his health had deteriorated substantially, necessitating his transfer to a 24-hour nursing care unit. According to a filing in December, his weight had dropped from 200 pounds to 142 pounds in the previous 18 months, that he was having trouble walking. His attorney said Ebbers had fallen and suffered head injuries numerous times.

According to his motion for early release in September, his eyesight has also worsened in recent years. It said because of his diminished eyesight, Ebbers unintentionally bumped into another prisoner while walking in the facility in September of 2017. The prisoner came to Ebbers’ open cell later in the day and physically attacked him for bumping into him, fracturing the bones around his eyes, causing blunt head trauma and other injuries.

But Ebbers’ various requests for early release due to his health had been denied by the Bureau of Prisons until it was granted by a federal judge in December.

In the filing, his attorney said it was estimated he had only 18 months to live.