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CLINTON, MISS. Scandal shocks town



Published: Thu, July 4, 2002 @ 12:00 a.m.



Corporate scandals are now disrupting small-town life.

CHRISTIAN SCIENCE MONITOR

CLINTON, MISS. -- Until WorldCom's accounting scandal started drawing federal investigators and media hordes, the biggest controversy here was whether the town would bend to state pressure and up the speed limit on its main drag -- better known to locals as a costly speed trap.

But WorldCom, the telecommunications giant that put this little Southern town on the big-business map, laid off 17,000 employees last week as it admitted that it had improperly accounted for $3.8 billion in expenses.

The WorldCom scandal has now put Clinton on another kind of map -- that of corporate fraud.

Small-town intrusions

And, Clinton -- population 23,347 -- is just one in a growing number of small-town dots on that map. Corporate scandal -- once seen largely as a big-city controversy -- is intruding on these peaceful paradises.

Adelphia Communications, the cable-television giant now in bankruptcy after $3 billion of questionable activity, is based in Coudersport, Pa., population 2,650. Tyco International, a huge conglomerate whose former CEO just received his second indictment, has its U.S. headquarters in Exeter, N.H., home to13,309.

They are places with smiling faces and uncomplicated lives, where children still set up lemonade stands and the main topic around town is whether the high school team will make the state tournament. They're the kind of places where everyone knows everyone else -- for better or worse. The kind of places CEOs want to raise their children.

So when camera crews come to town to chronicle severe business misdeeds, it is a rude shock.

"There has to be wretched disappointment," says David Heenan, author of "The New Corporate Frontier: the Big Move to Small Town USA." "It's like having someone in the family and then all of sudden finding out they are a black sheep."

Nowhere is this more evident than Clinton.

Quiet in town

It's Wednesday evening and the streets are empty. Except for the American flags wafting in the sultry breeze along Clinton Boulevard, the only noticeable activity is the chirp of crickets in the dense pine thickets. It's prayer night in this bricked bedroom community -- and it'll stay quiet until the churches let out, and everyone heads to the Dairy Queen.

When WorldCom, the nation's second-largest long-distance provider, decided to move from nearby Jackson in 1998, the town was thrilled, said Mayor Rosemary Aultman.

Bernard Ebbers -- known to everyone here as Bernie, whether they knew him or not -- was almost a folk hero around town. He came to Clinton from Edmonton, Alberta, to play basketball for Mississippi College on scholarship and stayed to coach high-schoolers.

After dabbling in various business ventures, he and several friends met at a coffee shop in Hattiesburg and used a napkin to sketch a plan for acquiring a long-distance telephone company during the 1980s era of the breakup of AT & amp;T. The company, Long Distance Discount Service, grew to be the only Fortune 500 company in the state.

"Bernie was a local celebrity," says Robert Schoenberger, a business writer for the Clarion-Ledger in Jackson. "It was a local-boy-done-good kind of story. Many people remember him playing basketball and, next thing you know, he's running a giant telecommunications company. It was such a dramatic success story."

That's why many residents simply wouldn't let go of their stock, even though it has been clear for more than a year that things weren't going well.

It's hard for residents here to believe that Mr. Ebbers -- a devoted Christian and big town booster -- was to blame. Many still cling to the belief he didn't know what was going on.

That could be why the town isn't seething, but simply sad. Indeed, a group of young women emerging from the Wednesday prayer meeting at the Morrison Heights Baptist Church say they haven't heard much anger or feelings of betrayal. They express genuine sadness that their beloved town is under such fire.

"It was almost like the community had taken ownership of WorldCom," says Cari Cade, who graduated from Mississippi College a few years ago and didn't want to leave the tight-knit community.




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