NEW YORK, Aug. 29 (UPI) -- Embattled MCI, reeling from criminal indictments in Oklahoma, may soon face other state lawsuits alleging widespread tax fraud, it was reported Friday.
The first of the suits against the bankrupt long-distance carrier, which is being prepared by West Virginia Attorney General Darrell McGraw, may be filed within days, according to people familiar with the matter, the Wall Street Journal said. Oklahoma filed its suit against the company and several former executives on Wednesday.
At issue in the suits is a complicated setup allegedly used by the company, then known as WorldCom Inc., to avoid hundreds of millions of dollars in state taxes in the three years after its 1998 acquisition of MCI Communications Corp.
The new lawsuits would be another blow for MCI, which is struggling to emerge from the long shadow cast by an $11 billion accounting fraud, the largest in U.S. history. MCI recently agreed to a $750 million settlement with the SEC.
