Worldcom ex-financial chief gets jail term

NEW YORK: Ex-WorldCom Inc. financial chief Scott Sullivan, the government's star witness at the criminal trial of former Chief Executive Bernard Ebbers, was sentenced on Thursday to five years in prison for assisting in the $11 billion business fraud at the company.

Sullivan, 43, pleaded guilty to conspiracy, securities fraud and making false financial filings. He cooperated with prosecutors probing wrongdoing at WorldCom in hopes of receiving a reduced prison sentence.

"Everyday I regret what happened at WorldCom and I accept responsibility for the false and misleading information" that was given to investors, Sullivan told Manhattan federal judge Barbara Jones.

"I knew it was wrong, but my intentions were not to hurt people."

At Ebbers' trial, Sullivan directly tied his former boss to the accounting misdeeds that led to WorldCom's descent into bankruptcy in 2002. He said Ebbers knew about improper accounting entries that were made to hide skyrocketing expenses and inflate revenue.

Last month, Ebbers was sentenced to 25 years in prison for masterminding the financial wrongdoing. He has said he is innocent and plans to appeal.

Prosecutors recently sent the judge a memo commending Sullivan for his cooperation in the case, saying it was "primarily Sullivan's testimony that contributed to the government's successful prosecution."

Four other lower-ranking ex-WorldCom executives have been sentenced by the same judge over the past week, with their punishments ranging from probation to one year in prison.

Like Sullivan, all four had agreed to cooperate with prosecutors and pleaded guilty.

Judge Jones told Sullivan that were it not for his enormous cooperation with prosecutors as well as the extenuating family situation -- his wife is diabetic and he has a young daughter -- he would have faced a harsher sentence.

George Newhouse, a former federal prosecutor who is not involved in the case, said judges, who in the past may have sentenced white-collar defendants who cooperated with prosecutors to only probation or demanded they pay fines, are getting tougher in handing out prison time.

That is because courts are trying to send a message to corporate America that financial wrongdoing will not be tolerated, he said.

"By historical standards, these sentences that are being handed out today are off the charts," said Newhouse, a partner at law firm Thelen Reid & Priest LLP in Los Angeles.

In another closely watched case where a top executive pleaded guilty and cooperated with prosecutors, former Enron Corp. CFO Andrew Fastow reached a plea deal with the government last year that will require him to serve a 10-year prison term.

Fastow's plea came ahead of the trials of his former bosses, Kenneth Lay and Jeffrey Skilling, which are set for early 2006 in federal court in Houston.