WorldCom Auditor Arthur Andersen Settles Fraud Suit

April 25, 2005

Arthur Andersen LLP, the lone remaining defendant in the three-year investor lawsuit stemming from WorldCom Inc.'s 2002 collapse, agreed to settle its liability in the case, U.S. District Judge Denise Cote said.

The settlement, announced in an order issued by the judge today, also ends a four-week trial in New York federal court at which a jury of five women and four men heard evidence suggesting that the accounting firm overlooked accounting manipulations and fraud at the long distance company.

``That fraud could have been stopped dead in its tracks if Arthur Andersen had been looking to do its job instead of looking to line its pockets,'' lead investor lawyer Sean Coffey said during opening arguments.

The settlement ends the largest securities fraud class action in U.S. history. Lawsuits against former WorldCom officers, 12 ex- directors, 17 investment banks and Andersen were first filed in Spring 2002 after the U.S. Securities and Exchange Commission requested documents from the company.

Labels: Sean Coffey