NEW YORK -- Former WorldCom Inc. chief Bernard Ebbers orchestrated an $11 billion accounting fraud and then told "lie after lie after lie" about the telecommunication company's crumbling finances to protect its stock price and his own personal fortune, a prosecutor said yesterday in opening statements at Ebbers's trial.
Ebbers began the lies in October 2000, painting a false picture for investors and ignoring that WorldCom had not met Wall Street expectations, federal prosecutor David Anders told jurors.
"When people buy stock in a company, they purchase the right to be told the truth," Anders said. "Bernard Ebbers violated that trust. He violated that trust by directing this fraud, and then telling lie after lie after lie about how his company, WorldCom, was performing."
But Ebbers's lawyer, Reid Weingarten, told jurors the government's case reminded him of "one of those well-crafted docudramas you see on television."
"This man is not capable of committing the crimes charged," said Weingarten, pointing at Ebbers, who listened intently to the proceedings, occasionally crossing one leg over another and holding one hand to his chin.
Anders said the fraud included secretly draining reserve accounts to cover unexpectedly large expenses and hiding expenses in capital accounts.
By late 2000, WorldCom's revenues were suffering and its expenses far higher than expected, Anders said.
But he said Ebbers was obsessed with matching Wall Street's expectations for profits.
So, Anders said, Ebbers repeatedly told chief financial officer Scott Sullivan: "We have to hit the number."
"It was a command to commit fraud," the prosecutor said.
Weingarten appeared to take an early swipe at Sullivan, the government's star witness, alluding to him as "one of the most impeachable witnesses ever to hit a witness stand."
Ten women and six men were selected yesterday as jurors and alternates to hear the accounting-fraud trial before US District Judge Barbara Jones.
Ebbers, 63, is accused of orchestrating an accounting fraud at WorldCom, which collapsed in 2002 in the largest bankruptcy in US history.
The charges against Ebbers -- fraud, conspiracy and making false regulatory filings -- carry up to 85 years in prison.