Image: Bernard Ebbers
Louis Lanzano  /  AP file
Former Worldcom CEO Bernard Ebbers' conviction on charges relating to an $11 billion accounting scandal was upheld by the federal court.
updated 7/28/2006 3:43:54 PM ET 2006-07-28T19:43:54

A federal appeals court on Friday upheld the conviction of former WorldCom Inc. Chief Executive Bernard Ebbers on charges related to a multibillion dollar accounting fraud.

The ruling by the three-judge panel of the 2nd U.S. Circuit Court of Appeals could clear the way for Ebbers to begin serving a 25-year prison sentence for his actions as head of the telecommunications company.

Convicted in 2005, Ebbers had argued on appeal that he had been denied a fair trial and that his lengthy prison sentence was unreasonable.

Writing for the court, Judge Ralph K. Winter acknowledged that 25 years is a long sentence for a white collar crime, "longer than the sentences routinely imposed by many states for violent crimes, including murder."

But he added that Ebbers' actions to hide WorldCom's financial problems were substantial, and had cost investors dearly.

"The securities fraud here was not puffery or cheerleading or even a misguided effort to protect the company, its employees, and its shareholders from the capital-impairing effects of what was believed to be a temporary downturn in business," Winter wrote. "The methods used were specifically intended to create a false picture of profitability even for professional analysts that, in Ebbers' case, was motivated by his personal financial circumstances."

When the extent of the $11 billion accounting fraud was revealed, WorldCom collapsed and declared bankruptcy.

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