The "BUCK" really stops with the BOD not with a favorable ruling at this juncture!
Cover-up continued until the bitter end when the CEO(he later claimed to be only a coach who the elective BOD must have thought was heaven-sent) received an effective life term and bankruptcy for the company where the shareholders lost everything due to the bottom-line of an ineffective home-grown board of directors, in effect. Near the end, the CEO ditched his wife and later married an employee from Investor Relations who recently ditched him for a local rich lawyer according to sources.
If you are a member of an elective BOD of a long-distance telephone provider, you need to know that "access charges" paid to other providers are current expenses rather than assets extending beyond the current accounting period. The effect of deferring current expenses to subsequent periods was used as an umbrella to a bad business model generating net operating losses rather than profits over an extended period.
Many business models can survive one weak-link if it can be changed in an orderly fashion in due process; however, any cover-ups may extend for too long a period into the "point of no return" and into bankruptcy.
Even in not-for-profits, a weak link related to "even alleged moral issues" which may be acceptable to a "jury selected from the general population" but not from a "jury selected from the population of the main revenue source" will never suffice to reconstitute confidence for the main revenue source even when a jury of the general population may render a favorable ruling. With this thought in mind as a member of any BOD of a not-for-profit, serious thought should be given to a resolution of even alleged moral issues other than the "benefits that may be derived from a favorable decision from either a bench ruling or a jury selected from other than that of the main revenue source. The main revenue source is apt to continue to see a cover-up rather than a resolution as a break-even solution, rightly or wrongly!
http://www.worldcomnews.com/whoistoblame.html"Who Is To Blame ?
Naturally no one is stepping up to take the blame. WorldCom blames auditor Arthur Andersen for not uncovering the irregularities. Andersen claims they did not know about the improper accounting. They say former CFO Scott Sullivan never told the firm about the dubious accounting.
So far, Sullivan and former CEO Bernard Ebbers have basically pleaded the fifth and remained silent. Ebbers states he has done nothing fraudulent and has nothing to hide. Sullivan told WorldCom lawyers that Ebbers did know of the money shifted into the capital expenditure accounts.
John Sidgmore, current President and CEO, blames the former management for the company's problems.
Wall Street Analyst Jack Grubman, who gave high favor to the stock, has admitted he rated the stock to high for too long. He insists he was unaware of the company's true financial shape."