WorldCom workers in commissions scam

By Don Stancavish
Bloomberg News Service

WorldCom Inc., the second-biggest U.S. long-distance telephone company, said an internal audit has found that about a dozen salespeople improperly boosted their commissions. The shares fell as much as 8.4 percent.

At least three employees who worked in WorldCom's office in Arlington, Va., will be fired or forced to quit for claiming commissions that weren't theirs, spokesman Brad Burns said. The rest had their salaries frozen and also may be fired, he said.

WorldCom revealed details of its investigation a week after Chief Executive Officer Bernard Ebbers assured investors that the Clinton, Miss.-based company's finances are sound.

The actions by the salespeople cost WorldCom as much as $4 million, said Burns. He said the company expects to recover the money and the matter won't affect financial results.

"I applaud them for coming and saying we're taking action on this, we're firing these people," said Michael Bowen, an analyst at SoundView Technology Group who rates WorldCom "hold" and owns the shares personally. "I certainly hope there's nothing more under the surface with this."

Shares of WorldCom slipped 42 cents, or 5.9 percent, to $6.70 in midday trading after falling as low as $6.52. The stock had dropped 58 percent in the past year. More than 40 million shares changed hands, making WorldCom the most active stock in U.S. trading.

The salespeople under investigation claimed commissions that other salespeople had already collected, essentially double-billing the company, Burns said.