United States Securities and Exchange Commission

Litigation Release No. 17783 / October 10, 2002

Accounting and Auditing Enforcement Release No. 1650 / October 10, 2002

SEC Charges Two Former WorldCom Accountants, Betty Vinson and Troy Normand,
with Participating in Multi-Billion Dollar Financial Fraud

   The Securities and Exchange Commission today filed a civil enforcement
   action against Betty L. Vinson and Troy M. Normand, former accountants
   in the General Accounting Department of WorldCom, Inc. The Commission
   charges that Vinson and Normand participated in a massive fraud that
   inflated the company's earnings at the direction and with the
   knowledge of WorldCom's senior management. WorldCom has admitted that
   from at least as early as 1999 through the first quarter of 2002, as a
   result of undisclosed and improper accounting, it materially
   overstated the income it reported in its financial statements by
   approximately $7.2 billion.

   Also today, in connection with the same conduct, Vinson and Normand
   pleaded guilty to criminal charges filed by the U.S. Attorney's Office
   for the Southern District of New York.

   Vinson and Normand are charged by the Commission with violating the
   antifraud, books and records, and internal controls provisions of the
   federal securities laws (Section 17(a) of the Securities Act of 1933
   ("Securities Act") and Sections 10(b) and 13(b)(5) of the Securities
   Exchange Act of 1934 ("Exchange Act") and Rules 10b-5 and 13b2-1
   thereunder). They are also charged with aiding and abetting WorldCom's
   violations of the periodic reporting, books and records, and internal
   controls provisions (Exchange Act Sections 13(a) and 13(b)(2)(A) & (B)
   and Rules 12b-20, 13a-1 and 13a-13 thereunder). The Commission seeks
   against Vinson and Normand permanent injunctions, disgorgement of all
   ill-gotten gains, and civil money penalties.

   The Commission's action against Vinson and Normand is its fourth civil
   enforcement action related to the WorldCom fraud. The first was filed
   against WorldCom, Inc. on June 27 of this year. (.) The Commission
   sought, among other things, the appointment of a corporate monitor,
   and on July 3, U.S. District Court Judge Jed S. Rakoff appointed
   former Commission Chairman Richard Breeden to that position. The
   Commission's second enforcement action was filed against former
   WorldCom Controller David F. Myers on September 26. (.) The
   Commission's third enforcement action was filed against Vinson and
   Normand's supervisor, former WorldCom Director of General Accounting
   Buford "Buddy" Yates, Jr., on October 7. (.)