Global Crossing executives to face Congress Thursday

ITworld.com –

Executives of bankrupt undersea fiber-optic cable network operator Global Crossing Holdings Ltd. will testify before the Subcommittee on Oversight and Investigations of the U.S. House of Representatives Committee on Financial Services on Thursday, the company said Sunday.

John Legere, chief executive officer of Hamilton, Bermuda-based Global Crossing, and Dan Cohrs, the company's chief financial officer, have been called to Capitol Hill to take part in hearing that will "examine the effects of the Global Crossing bankruptcy on investors, financial markets, and employees," according to a letter of invitation from committee Chairwoman Sue W. Kelly, congresswoman from New York, quoted by the company.

The hearing is scheduled to begin at 10am ET (15:00 GMT) on Thursday.

The hearing is not the only action surrounding the bankruptcy of Global Crossing that is taking place in Washington.

The House of Representatives Committee on Energy and Commerce has begun looking at the company's accounting practices. The committee is currently investigating the accounting of failed energy trader Enron Corp. and was led to probe Global Crossing after news reports that the company many have engaged in similar accounting practices. Global Crossing used the same auditor as Enron, Arthur Andersen LLP.

The committee has requested Global Crossing turn over a large number of documents including details of IRU (indefeasible right of use) contracts for capacity on cables signed since 1998, details of capacity swap arrangements with other telecommunication carriers, details of concerns over accounting practices, shares and options schemes and benefits provided to executives.

Separately, the U.S. Securities and Exchange Commission has also launched an investigation into Global Crossing's accounting.

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