The former vice president of Internal Auditing for WorldCom Telecommunications Company, Cynthia Cooper, who was credited with detecting and reporting the company’s fraud of approximately $11 billion, spoke Nov. 2 on moral and ethical leadership. The speech, held at the Envie restaurant in Thibodaux, was sponsored by the College of Business Administration and JP Morgan Chase as part of the Management Excellence Series.

“People are faced with moral and ethical dilemmas everyday, and it is not always easy to make the right decision,” Cooper said.

Sometimes basically good people can end up on a very slippery slope, Cooper said.

Scott Sullivan, the former chief financial officer at WorldCom, underreported expenses from third party companies and inflated revenues by entering false journal entries into the company’s accounting system, Cooper said.

Sullivan asked Betty Vinson and Troy Normand, former accountants at WorldCom, to make the false journal entries, and he assured them it would all work out in the end. Moreover, Sullivan said he would be responsible if anything went wrong, Cooper said.

Vinson and Normand wrote resignation letters disagreeing with Sullivan’s decisions but never submitted theme.

This decision cost Vinson and Normand their careers.

Civil actions were filed against Vinson and Normand Oct. 10, 2002, and Vinson was sentenced to five months in prison, and Normand served no jail time.

These two people were basically good, but they fell under the demands of their superiors, Cooper said.

“Find the courage to go forward in the face of pressure from superiors,” Cooper said.

On making difficult decisions, Cooper said people must realize doing the right thing does come at some cost.

Being a “whistleblower,” Cooper said she learned to reevaluate her moral values starting with the golden rule: treat people how you want to be treated.

She encouraged the audience to find its moral compass and have the courage to do the right thing, even if it is not the easiest thing to do.

“Uncovering the fraud was the most difficult thing I have ever experienced,” Cooper said.

She said the members of her team felt afraid, betrayed and became very depressed after they reported their findings.

Cooper and her team uncovered the fraud because of a routine audit of the company. When numbers did not match, Cooper knew something was wrong.

A student in attendance, Chris Breaux, management senior from Houma, said it is important for leaders of organizations to have strong moral and ethical character because the people who are under them look up to their superiors.

On March 15, 2005 the Chief Executive Officer of WorldCom, Bernard Ebbers, was sentenced to 25 years in prison and lost all assets, Cooper said.

Sullivan was sentenced to five years in prison as part of a plea agreement to testify against Ebbers.

The WorldCom Company eventually filed for the largest bankruptcy case in U.S. history.

Cooper was named one of Time Magazine’s Persons of the Year in 2002 and was the first woman to receive the Accounting Exemplar Award in 2003.