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Persistent auditor brought WorldCom scandal to light
Compiled from Times wires The $3.8-billion in phony accounting at WorldCom that's shaking Wall Street and Washington was discovered through the persistent efforts of an internal auditor. Those who know Cynthia Cooper aren't surprised the methodical auditor found a devastating problem that the outside accountants from Arthur Andersen had never noticed. And they're not surprised that she blew the whistle on wrongdoing in her workplace. 'If she did find something it would have been an exercise in futility to expect her to cover it up,' said Bobbie Maglathlin, a neighbor of Cooper's mother. Cooper, 37, follows Sherron Watkins, the Enron executive who tried to give her bosses early warnings of that company's accounting gimmickry. While Watkins starred in televised testimony before a congressional committee, Cooper has kept her near-anonymity. She is cooperating behind the scenes with federal prosecutors investigating WorldCom, the telephone giant that disguised billions in expenses as capital expenditures, inflating the company's profits. Rather than risk being accused of interfering with an active criminal probe, congressional committees rescinded requests for Cooper to testify in public. Her profile remains so low that few publications have found photographs of her. Cooper, a vice president at WorldCom, began an internal audit of the company's books in May with a specific focus on its capital expenditures, according to published reports. The accounting sleight-of-hand was concocted by Scott D. Sullivan, who at the time was WorldCom's powerful chief financial officer. He reportedly rebuffed Cooper's efforts to bring the $3.8-billion maneuver to light. Cooper persisted and took the matter to Max Bobbitt, chairman of the audit committee of WorldCom's board. He delayed taking action on her findings but eventually passed them along to the company's outside accountants, according to the Wall Street Journal. Cooper, who is married with two children, may be a compelling witness for the government. She grew up in Clinton, Miss., where WorldCom is based, and attended the local high school. She graduated from Mississippi State University, got a master's degree from the University of Alabama and was certified as an auditor. Cooper first joined WorldCom, then known as Long Distance Discount Service, as a consultant in the finance department in the early 1990s. She left for a time to join paging company SkyTel, but returned to LDDS in the mid-1990s to run its internal audit department. A former executive at the company told the Wall Street Journal that Cooper was motivated and dedicated, telling LDDS management at the time, 'I want to be a vice president some day.' Cooper's role as a whistle-blower is a point of pride for some in Clinton, which could use a few heroes as it watches its best-known business collapse. 'Cynthia is totally honest,' said Judy O'Neal Gressett, who taught Cooper at Clinton High School. 'I feel like we will get the true story from her that those of us who have WorldCom stock need to know.' -- Information from the Wall Street Journal and the (Jackson, Miss.) Clarion-Ledger was used in this report.
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From the Times Business report
From the AP
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