Sunday, July 24, 2005
Has the media been fair to Bernard Ebbers, who was recently convicted and sentenced to 25 years?
One person associated with the defense team does not think so and has written his case to the newspapers in the form of an op-ed. It remains to been seen whether the media will print this piece. In the meantime, you can find this op ed here -
Craig J. McCann, PhD, CFA, Securities Litigation and Consulting Group, Inc. states that:
"1. The bloodlust for Mr. Ebbers is misplaced and doesn’t justify the sentence. He should have been sentenced on the basis of what he was convicted of and 99% of the losses in WorldCom were definitely not caused by the things Mr. Ebbers was convicted of.
2. The standard of evidence for proving shareholder losses at sentencing hearings is so low that a rough assertion by the government suffices. I contrast this with the evidentiary burden in class action litigation.
3. The sentencing guidelines thresholds are so low that (combined with the low standard of proof for shareholder losses in sentencing hearings) executives at large publicly traded firms who are found guilty of filing false SEC reports statements will always get the maximum sentence – effectively a life sentence."
Although many may disagree with the Ebbers sentence, find the media mischaracterizing the harm, and find some of the recent white collar sentences beyond recognized punishment theory, convincing the public may prove more difficult. The Wall Street Journal's poll on the Ebbers sentence (here) shows 55% of the people voting in the poll finding the Ebbers sentence to be fair, with only 24% finding it too harsh. But maybe you haven't voted yet.