Dan Abrams
What the conviction of Bernie Ebbers really means
http://www.NewsAndOpinion.com |
The implications of this verdict extend well beyond the courtroom. Bernard Ebbers was the WorldCom CEO and he presided over the biggest fraud and bankruptcy in American history— $11 billion.
The guilty verdict on nine counts sends the message that you take the good with the bad. It means that all these white-collar fraud cases where everyone is pointing fingers— well, now, the buck stops somewhere. Prior to the fraud investigation Ebbers was touted in the press as a financial genius— the first guy who figured out how to stand up to AT&T, and a guy who pushed through over 75 deals to build a global telecom giant.
But for this trial, Ebbers argued that he wasn't responsible for cooking the books for nearly two years because he was just a former basketball coach who had never taken an accounting class in his life. But if that's really all he was, then why didn't he announce earlier that he was in over his head?
Ebbers seemed content taking responsibility for his success, but the moment then going got tough, the ruthless CEO got going and the former bouncer/milkman/high school coach was back.
He's not alone. It seems with many of these CEOs under fire— Ken Lay of Enron, for example— when the heat in the kitchen starts picking up, the chefs suddenly start acting like busboys.
Sure, this verdict is a success for prosecutors in pursuing corporate fraud cases, but it's also a victory for personal responsibility and accountability. Under Ebbers' watch, 20,000 employees lost their jobs and most of their pensions. Shareholders lost a fortune. Wall Street suffered its biggest bankruptcy in history.
The legal case pitted Ebbers against his CFO, Scott Sullivan. Sullivan pled guilty and testified against Ebbers, hoping he will get a break when he's sentenced. Sullivan even admitted to orchestrating the fraud, but said he did it because his boss, Ebbers, told him to.
Whether Ebbers actually ordered it, as the jury seems to have believed, or he just let it happen, today's verdict sends a message that you don't get to choose when you want to be the guy in charge.
If CEOs aren't ready to accept that, then they should find another line of work.
It doesn't mean that every CEO who ran a failed company should be held criminally responsible. But it does mean that for corrupt companies, the people in charge better have a pretty compelling argument for why they were MIA when things went bad.
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JWR contributor Dan Abrams anchors “The Abrams Report,” Monday through Friday from 6-7 p.m. ET on MSNBC TV. He also covers legal stories for “NBC Nightly News with Tom Brokaw,” “Today” and “Dateline NBC.” To visit his website, click here. Comment by clicking here.
