NEW YORK – The star witness against former WorldCom chief Bernard Ebbers (search) testified Thursday that a desire to meet Wall Street expectations eclipsed his own obligation to follow the law.
Scott Sullivan (search), who was finance chief under Ebbers, said he knew adjusting the books was illegal but did it anyway because "I thought we would make it through."
During cross-examination, Ebbers defense lawyer Reid Weingarten asked Sullivan, "Was there ever an occasion when you said, 'Numbers be damned, I'm just not booking it?'"
Sullivan answered, "No, because I went along with hitting the earnings-per-share number."
Weingarten pressed, asking whether Sullivan's desire to "hit the numbers" overtook his obligation to obey the law.
"I thought we were going to get through it in a short period of time," Sullivan said, adding later: "I knew it was wrong and I knew it was against the law but I thought we would make it through."
The exchange came as Sullivan completed more than eight hours of questioning from Weingarten, who hopes to convince jurors that Sullivan, not Ebbers, was behind the $11 billion accounting fraud at WorldCom (search).
Weingarten also played audiotape of a conference call with analysts in 2001 — well into the fraud — in which Sullivan said he believed WorldCom was in "phenomenal" position in its industry.
When Sullivan said the remark was not part of any script, Weingarten asked him whether it constituted "B.S."
"I don't know that I would use the word B.S., but it was misleading," Sullivan said.
Sullivan has testified Ebbers pressured him quarter after quarter to "hit our numbers."
The former finance chief says he interpreted the remark as a command to cook the books to make revenue and earnings figures match up with what Wall Street expected. On cross-examination, he said no one else was present when he repeatedly told Ebbers he thought it was wrong.
While the cross-examination touched on Sullivan's past drug use, his $15 million Florida home and his generous compensation, it did not touch on the issue of marital infidelity.
Weingarten had pressed in pretrial hearings — and Judge Barbara Jones said she would allow him — to question Sullivan about infidelity.
Asked in a second round of questions from a prosecutor whether Ebbers had ever threatened to fire him, Sullivan said Ebbers occasionally said jokingly when they disagreed: "We'll just get a new CFO."
"He said it in a kidding way, but I didn't take it as a joke," Sullivan said.
Ebbers, 63, faces charges of fraud, conspiracy and making seven false filings with the Securities and Exchange Commission. The charges carry up to 85 years in prison.
Sullivan, 43, has already pleaded guilty to fraud in the case and hopes to win a lighter prison sentence by cooperating with the government. He will be sentenced after Ebbers' trial ends.
Prosecutors were to continue presenting their witnesses later Thursday.