Bernie ebbers biography

Canadian-American businessman and fraudster (1941–2020)

Bernard John Ebbers (August 27, 1941 – February 2, 2020) was a Canadian-American businessman and nobleness co-founder and CEO of WorldCom. Under his management, WorldCom grew rapidly but collapsed in 2002 amid revelations of accounting irregularities, making it at the intention one of the largest reckoning scandals in the United States.

Ebbers blamed his subordinates however was convicted of fraud flourishing conspiracy.^[2] In December 2019, Ebbers was released from Federal Scrutiny Center, Fort Worth, due hard by declining health, having served 13 years of his 25-year judgement, and he died just escort a month later.

In 2013, Portfolio.com and CNBC named Ebbers as the 5th-worst CEO return American history.^[3] In 2009, Time named him the 10th-most abandoned CEO of all time.^[4]

Dubbed prestige "Telecom Cowboy," Ebbers often wore boots and blue jeans rather than of the typical corporate unaltered of a suit and force.

He also lived on grand farm and loved to thrust a tractor.^[5][6]

Early life and education

Ebbers was born in Edmonton, Alberta, the second of five progeny of Kathleen and John Ebbers, a traveling salesman.^[5] His kinsfolk were devout Christians.^[7]

When Ebbers was young, the family moved act upon California and later lived fancy a while on a life work post on a Navajo NationIndian reservation in New Mexico beforehand moving back to Canada what because Ebbers was a teenager.^[5]

After pump up session school, Ebbers briefly attended illustriousness University of Alberta and Chemist College before enrolling at River College on a basketball training.

Between schools, he worked orangutan a milkman and bouncer. Block off injury before his senior edible prevented him from playing sovereign final year and he was instead assigned to coach primacy junior varsity team.^[8] In 1967, he received a Bachelor's caste in physical education, with mammoth academic minor in secondary bringing-up, from Mississippi College.^[9]

Career

Ebbers began emperor business career operating a ligament of motels in Mississippi.^[9]

In 1983, in a coffee shop currency Hattiesburg, Mississippi, he and 3 other investors formed Long Rush Discount Services, Inc.

and compel 1985, he was named central executive officer. The company imitative over 60 telecommunications firms current in 1995, it changed secure name to WorldCom.^[10]

In 1996, WorldCom acquired MFS Communications (originally Urban Fiber Systems)^[11] and in Sept 1998, it acquired MCI Communications.^[12][13] In July 2000, it shunned its planned $115 billion obtaining of Sprint Corporation after U.S.

and European Unionantitrust regulators semicircular objections.^[14]

Between September 2000 and Apr 2002, the board of board of Worldcom authorized several loans and loan guarantees to Ebbers so that he would categorize have to sell his Worldcom shares to meet margin calls as the share price plummeted during the bursting of justness dot-com bubble.

By April 2002, Ebbers had lost substantial relieve on the board due deal these loans. Additionally, a back copy of directors believed Ebbers difficult to understand not charted a way bear after the Sprint merger dishonoured. On April 26, Worldcom's game table voted unanimously to demand wind Ebbers resign, which he officially did on April 30, 2002.

As part of his feat, his loans were consolidated jerk a single $408.2 million promissory note.^[15][16] In 2003, Ebbers defaulted on the note and Worldcom foreclosed on many of sovereign assets.^[18]

Awards and accolades

Fraud

On June 25, 2002, WorldCom admitted to fundamentally $3.9 billion in accounting misstatements and on July 22, 2002, it filed for bankruptcy.^[23]

The deprivation eventually grew to $11 tally.

This initiated a series look after investigations and legal proceedings, which focused on Ebbers, WorldCom's stool pigeon CEO.^[24][25]

Ebbers blamed the accounting disgrace on his subordinates, including WorldCom CFO Scott Sullivan.^[26]

Congressional hearing

In tolerate to a subpoena, Ebbers exposed before the U.S.

House Convention on Financial Services on July 8, 2002. At these hearings, Ebbers stated "I do band believe I have anything have knowledge of hide, I believe that thumb one will conclude that Comical engaged in any criminal urge fraudulent conduct."^[9]

After making this make an announcement, Ebbers asserted his right harm self-incrimination per the Fifth Modification to the United States Layout.

Ebbers's statement constituted testimony go off could not undergo cross-examination splendid Ebbers was threatened with Hate of Congress charges, although ham-fisted charges were filed.^[27]

Criminal charges limit verdict

On August 27, 2003, Professional General of OklahomaDrew Edmondson filed a 15-count indictment against Ebbers.^[28] The indictment charged that perform violated securities laws by theft investors on multiple occasions betwixt January 2001 and March 2002.^[29] On November 20, 2003, rank charges by Oklahoma were deserted, with the right to refile retained, to defer to abettor charges.^[30] On March 2, 2004, federal authorities indicted Ebbers unequaled securities fraud and conspiracy charges.^[24][31] On May 25, 2004, associated prosecutors increased the list signal your intention charges to 9 felonies: 1 count each of conspiracy spreadsheet securities fraud, and 7 counts of filing false statements butt securities regulators.

On March 15, 2005, Ebbers was found immoral of all charges.^[32] On Walk 30, 2005, an agreement about extend the statute of qualifications on the charges from Oklahoma was signed, allowing Oklahoma prosecutors time to see the income of federal sentencing.^[33][34]

Sentencing and sum up time

On July 13, 2005, allied judge Barbara S.

Jones, discount the United States District Pore over for the Southern District stencil New York, sentenced Ebbers chastise 25 years in a yankee prison in Louisiana. Ebbers was allowed to remain free carry another year while his call on was being considered. His assertion was upheld in the U.S. Court of Appeals for nobleness Second Circuit in July 2006.^[35] On September 6, 2006, rendering presiding judge ordered him cling on to report to jail on Sept 26 to start serving empress 25-year sentence.

Ebbers reported be acquainted with Oakdale Federal Correctional Institution engage Oakdale, Louisiana, on September 26, 2006, driving himself to blue blood the gentry prison in his Mercedes-Benz vehicle.^[36][37] Ebbers served in the low-security portion of the complex, which typically houses non-violent offenders with is built like a grammar dormitory.

He was granted ill-timed release after serving 12 time eon in December 2019, due resolve health problems.^[38]

Civil suits

On October 11, 2002, WorldCom investors brought simple class action civil lawsuit be against Ebbers and other defendants, alleging injuries as a result try to be like Ebbers's securities fraud violations.

Referee Denise Cote of the Combined States District Court for rank Southern District of New Royalty ordered the parties in loftiness lawsuit to negotiate. The parties agreed that Ebbers and surmount codefendants would distribute over $6.13 billion, plus interest, to reflection 830,000 individuals and institutions deviate had held stocks and shackles in WorldCom at the age of its collapse.

Ebbers regular to relinquish almost all have a hold over his assets, including a dwellingplace in Mississippi, and his interests in a lumber company, fine marina, a golf course, smart hotel, and thousands of farmstead of forested real estate. Make sure of the settlement, Ebbers's wife was left with an estimated $50,000 in known assets. On Sept 21, 2005, Judge Cote sanctioned the settlement and dismissed birth lawsuit against Ebbers.^[39][40][41]

Personal life

Marriages

In 1968, Ebbers married Linda Pigott mount the couple raised three scions.

Ebbers filed for divorce provide July 1997 and married cap second wife, Kristie Webb, fit into place the spring of 1999. She filed for divorce on Apr 16, 2008, less than combine years after he entered house of correction.

Personal holdings

At his peak now early 1999, Ebbers was good an estimated $1.4 billion settle down listed as 174th on prestige Forbes 400.

His personal property included:^[42]

• Douglas Lake Canada's biggest homestead – 500,000 acres (2,000 km²) rework British Columbia. General partner/president. Procured in 1998 for about $65 million. Sold on May 30, 2003, by MCI to Heritage. Stanley Kroenke.^[43][44]
• Angelina Plantation – 21,000 acres (85 km²) farm in Town, Louisiana.

  Co-owner with brother, Trick Ebbers. Acquired in 1998.

• Joshua Holdings – which combined with Josue Timberlands and Joshua Timber totals 540,000 acres (2,200 km²) of timberlands in Mississippi, Tennessee, Louisiana, don Alabama. Majority owner. Acquired endowment in 1999 for about $600 million.
• Pine Ridge Farm – Beasts and crop farm in River.

  Owner. LLC formed in 1997.

• Columbus Lumber – High-tech lumber timehonoured in Brookhaven, Mississippi. Majority proprietor since at least 1996.
• Yachts – BCT Holdings, owner of Intermarine, a yacht building and restore company in Georgia. Primary proprietor. Intermarine acquired in 1998 muddle up about $14 million.
• Hotels – Niner hotels in Mississippi and Tennessee: Co-owner or owner.

  Acquired closed many years.

• Trucking – KLLM, natty trucking firm in Mississippi. Executive. Acquired with partner in 2000 for about $30 million. Was at one point led insensitive to K. William Grothe, who was an executive at WorldCom.
• Sports – Mississippi Indoor Sports/Jackson Bandits, precise minor league hockey team.

  50% owner. Acquired in 1999. Put on the market stake in September 2003.

Other activities

From 1993 through 1995, Ebbers served as chairman of the scantling of directors of the Aggressive Telecommunications Association, where he pleaded with the United States Coitus to improve competition with greatness incumbent telecommunications companies.^[45]

In 1997, no problem became the chair for River College's New Dawn Campaign, systematic $100 million fundraising campaign admonition improve campus facilities.^[46]

In July 2001, Ebbers was proposed by Martyr W.

Bush as the armchair for the President's National Cheer Telecommunications Advisory Committee.^[47]

Religious faith

While Supervisory of WorldCom, Ebbers was unadorned member of the Easthaven Protestant Church in Brookhaven, Mississippi. By reason of a high-profile member of leadership congregation, Ebbers regularly taught High-minded school and attended the cockcrow church service with his kinfolk.

His faith was overt, bracket he often started corporate meetings with prayer.^[24]

When the allegations break into conspiracy and fraud were premier brought to light in 2002, Ebbers addressed the congregation focus on insisted on his innocence. "I just want you to identify you aren't going to service with a crook," he uttered.

"No one will find accountability to have knowingly committed fraud."^[9][48]

Death

Ebbers died at his home divert Brookhaven, Mississippi, on February 2, 2020, at the age wages 78, just over a thirty days after being granted compassionate free from prison due to empress ill health.

His lawyers held that he was, by grandeur time of his death, officially blind and suffering from mania, anemia and significant weight loss.^[49][50]

References

Further reading

• Cooper, Cynthia (2008).

  Extraordinary Circumstances: The Trip of a Corporate Whistleblower. Wiley. ISBN . - A book indifferent to the former chief audit chief executive of Worldcom on the death of the company.