TELECOM EXEC RESIGNS AFTER JUSTICE PROBE WINNICK EXPRESSES REGRETS.Byline: Gregory J. Wilcox Staff Writer Gary Winnick Gary Winnick was a founder of Global Crossing Limited, a telecommunications company providing worldwide computer networking services. He was CEO from the company's inception, 1997, until 2002. , founder and chairman of Global Crossing, an ambitious telecommunications enterprise whose bankruptcy decimated employee retirement accounts, resigned from the board of directors Monday. Winnick's resignation, effective today, was announced in a letter sent to company directors. It came a week after the Justice Department declined to prosecute executives after concluding a probe of the company's accounting methods. The company is still being investigated by securities regulators. In his letter, Winnick, known for his philanthropic endeavors, said he decided it was time to resign after helping the company with its bankruptcy reorganization plan A scheme authorized by federal law and promulgated by the president whereby he or she alters the structure of federal agencies to promote government efficiency and economy through a transfer, consolidation, coordination, authorization, or abolition of functions. and setting up a $25 million fund for employees who bought company stock for their 401(k) plans. He deposited the money into an account for employees two weeks ago. ``The collapse of the telecommunications industry ... has taken a terrible toll on employees and investors alike, with an unprecedented loss of billions in investments and tens of thousands of jobs. I deeply regret that so many good people involved with Global Crossing also suffered significant financial loss,'' Winnick said in his letter. Winnick was on vacation Monday and could not be reached for comment, said attorney Terry Christensen. Winnick, a Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. resident, will now focus his attention on running Pacific Capital Group, an investment bank that he also founded, Christensen said. It invests in telecommunications, media, real estate, financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , health care, and biotechnology. Global Crossing responded to Winnick's letter with a written statement. ``With the recent confirmation of our plan of reorganization and a strong leadership team in place, Global Crossing is well on its way to completing the financial restructuring we initiated last year,'' the statement said. Winnick, a former associate of junk bond junk bond, a bond that involves greater than usual risk as an investment and pays a relatively high rate of interest, typically issued by a company lacking an established earnings history or having a questionable credit history. guru Michael Milken Michael Milken As an executive at Drexel Burnham Lambert Inc. during the 1980s, Milken used high-yield junk bonds for financing and corporate takeovers. While his personal wealth was enormous, he spent two years in prison after pleading guilty to charges of securities fraud. , founded Global Crossing in 1997 with a plan to lay fiber optic cable Noun 1. fiber optic cable - a cable made of optical fibers that can transmit large amounts of information at the speed of light fibre optic cable transmission line, cable, line - a conductor for transmitting electrical or optical signals or electric power under the world's oceans. The business blossomed and soon Global Crossing was supplying telecommunications services In telecommunication, the term telecommunications service has the following meanings: 1. Any service provided by a telecommunication provider. 2. internationally. He took the company public in 1998, and its stock peaked around $64. Global Crossing's market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. at one point exceeded that of General Motors Corp. Winnick's holdings in the company were once worth roughly $6 billion. That fortune, and the company's, began turning in March 2000; Global Crossing filed for bankruptcy last January. Winnick and other executives profited though, while investors lost huge amounts of money. And Winnick has held onto about 70 million Global shares, Christensen said. Global Crossing stock closed Monday at 3 cents, unchanged. That makes Winnick's stock worth about $2.1 million. CAPTION(S): photo Photo: (color) WINNICK |
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