Report: WorldCom Discovers $2 Billion More In Discrepancies

WorldCom

Citing a source familiar with the matter, the CNBC report said that WorldCom used an "accounting trick in which most of the $2 billion was reversed from reserves for bad debts into operating income." A spokeswoman for the company said WorldCom has no comment on this latest development.

WorldCom placed blame for the original accounting fraud of $3.8 billion in hidden expenses on Scott Sullivan, CFO, and David Meyers, controller. Both were arrested last week with charges pending.

During a June call with the media, John Sidgmore said he believed Sullivan and Meyers ordered a clerk to make changes to WorldCom's accounting records.

Sidgmore has also expressed his concern surrounding claims by former WorldCom auditor Arthur Andersen that it was unaware of the accounting discrepancies.

Sidgmore took over when longstanding CEO Bernard Ebbers resigned suddenly in April of this year.

Since revealing in June that it hid expenses and inflated profits during 2001 and the first quarter of 2002, WorldCom filed for Chapter 11 bankruptcy protection on July 21.