Meanwhile, the company is busy recreating itself as MCI and hoping to emerge from bankruptcy soon. BBC News Online assesses the latest state of affairs.

What is the latest settlement all about?

MCI (formerly WorldCom), while neither admitting or denying any wrongdoing, has come to a settlement with the US regulator.

The settlement is over its massive accountancy scandal, which is now thought to have run to $11bn, dwarfing even Enron's fraud.

MCI will pay a record $500m to the Securities and Exchange Commission, far and away the highest fine ever imposed by the regulator.

But the amount has been radically scaled back from the original $1.5bn figure because MCI declared itself bankrupt and so receives favourable treatment.

And former WorldCom employees were angered rather than pleased by the settlement.

One group, represented on BoycottMCI.com, described the agreement as "a slap on the wrist", equivalent to about one week's revenue and "insignificant by any standards".

Is this an end to the affair?

No.

The settlement sorts out the civil lawsuits that have been filed. But the criminal case, which is still pending, is much more significant.

However, the settlement is an important step on WorldCom's journey to reinvent itself and emerge from bankruptcy under its new name, MCI.

The fact that the civil lawsuits are now out of the way should give institutional investors a much clearer picture of what the future holds and help the firm to secure the necessary funding to exit bankruptcy.

The criminal charges relate primarily to the actions of former employees at the company and do not bear the same relation to MCI's future activities.

As part of the restructuring, the firm has reduced its headcount by 22,000, cut its expenditure by 13% and appointed Compaq's former chief executive, Michael Capellas, to lead the new, leaner firm.

So what's happening in the criminal case?

WorldCom's ex-controller, David Myers, and its former chief financial officer, Scott Sullivan, were arrested last August.

Mr Myers has pleaded guilty and is cooperating with prosecutors in the criminal probe.

Mr Sullivan, however, has denied any wrongdoing and is free on $10m bail.

Both men face prison terms of up to 65 years if convicted.

Finally, federal prosecutors are still trying to bring charges against the firm's founder and flamboyant top dog, Bernie Ebbers.

But, like the Enron trial, the complex nature of financial fraud means it is taking a very long time to piece together the evidence.

What exactly did WorldCom do wrong?

Founded in 1983, WorldCom was the second biggest long distance phone firm in the US with 20 million customers.

It ran into numerous difficulties during the technology boom and got into debts of $41bn while its assets were worth just $107bn.

The accounting irregularities are thought to have started at the beginning of 2001 and were revealed in June 2002.

WorldCom originally put a value of $4bn on the financial black hole. That has been slowly rising, first to $7bn, then $9bn and is now thought to total $11bn.