President Bush Wednesday denounced as outrageous the news that a leading U.S. telecommunications company, WorldCom, has admitted to fraudulent accounting practices.
Mr. Bush promises a full investigation of what happened at WorldCom. Speaking during a meeting with British Prime Minister Tony Blair, Mr. Bush said American companies must operate at the highest of high standards.
"Today the revelation that WorldCom has misaccounted for $3.4 billion is outrageous," he stressed. "We will fully investigate. And hold people accountable for misleading not only shareholders but employees as well."
Mr. Bush, clearly aware that U.S. equity markets are trading at levels even below their post-September 11 lows, said markets have trended lower because of fear of more terrorist attacks, low corporate earnings, and worry about lax accounting standards.
"And I can understand why," he said. "We've had too many cases of people abusing their responsibilities. People need to know that the SEC [Securities and Exchange Commission] is on it, our government is on it. After all Arthur Anderson [Enron's accounting firm] has been prosecuted. We will pursue within our laws those who are irresponsible."
Arthur Andersen, the giant accounting firm that audited Enron, the energy trading company that declared bankruptcy last December, also was the auditor at WorldCom.