WSJ: Former WorldCom Board Members Reach Settlement Agreement

Eleven former board members of WorldCom Inc. agreed to personally pay $20.2 million to settle a lawsuit related to the telecommunications carriers accounting fraud, the Wall Street Journal reported Monday.

The agreement is among the settlements reached in a class-action lawsuit headed up by New York State Comptroller Alan Hevesi, the newspaper reported. Under the recent settlement, insurers who provided the former board members with liability coverage also will pay $35 million, according to the newspaper.

The case seeks compensation from underwriters, former board members and WorldComs former auditor, Arthur Andersen LLP, the Journal said, noting that Arthur Andersen and former WorldCom Chairman Bert C. Roberts Jr. are set to begin trial later this month.

More than a dozen banks that underwrote WorldCom bonds in 2000 and 2001 have agreed to settlements totaling $6 billion, the newspaper wrote.

Former WorldCom Chief Executive Bernard Ebbers was found guilty last week of fraud, conspiracy and filing false documents with regulators for the $11 billion accounting fraud. He could be sentenced to prison for the rest of his life.

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