WorldCom CEO Bernard Ebbers Sentenced to 25 Years in Prison

On July 13, 2005, former WorldCom CEO Bernard Ebbers was sentenced to 25 years in federal prison for orchestrating the largest corporate accounting fraud in American history. The sentence, handed down by U.S. District Judge Barbara Jones in Manhattan, represented one of the harshest penalties ever imposed on a corporate executive and marked the peak of the post-Enron era of executive accountability.

Ebbers, 63 at the time of sentencing, was convicted in March 2005 of securities fraud, conspiracy, and filing false documents with regulators. Under his leadership, WorldCom overstated its profits by $11 billion between 1999 and 2002, deceiving investors and propping up the company’s stock price through systematic accounting fraud. The fraud wiped out billions in shareholder value and devastated employees whose retirement savings were invested in WorldCom stock.

Judge Jones rejected pleas for leniency, stating that Ebbers was responsible for the massive fraud even though he claimed ignorance of the accounting manipulations. The 25-year sentence effectively constituted a life sentence for Ebbers, sending a clear message that corporate executives could not escape personal criminal liability by claiming they were unaware of fraud occurring under their leadership.

Ebbers served 13 years at Federal Medical Center, Fort Worth, before being granted compassionate release in December 2019 due to declining health. He died at his home in Mississippi on February 2, 2020, at age 78. The Ebbers case represented the last time a major American CEO received such a lengthy prison sentence for corporate fraud—after the 2008 financial crisis, no Wall Street executives went to prison despite fraud that exceeded WorldCom’s in both scale and economic devastation.