WorldCom, in the midst of the largest fraud case in U.S. history, has reached a partial settlement with the SEC that will allow it to sidestep any fines or penalties for the time being.

The partial settlement includes a permanent injunction barring any other securities violations, and government oversight of the telecommunications giant. Additionally, WorldCom agrees to the following:

• not to violate securities laws in the future;
• to provide reasonable training and education to its senior operational officers and financial reporting personnel to minimize the possibility of future violations;
• to retain a consultant to review the effectiveness of WorldCom's material internal accounting control structure and policies; and
• that the Corporate Monitor in the case will review the adequacy and effectiveness of WorldCom's corporate governance and ethics policies.

The settlement also indicates that civil fines or penalties may be assessed at a later date if deemed appropriate.

The deal was "a model of what should be attempted in a case of this sort," said Judge Jed S. Rakoff, who approved the settlement.

With a $9 billion accounting scandal at its doorstep, with investors losing billions of dollars of equity, and with the world watching closely, the SEC is already being scrutinized for what appears to be a very light slap-on-the-wrist decision. "When you're talking about the biggest bankruptcy in history, you'd think the SEC would be a little more thorough," says Tom Schatz, president of Citizens Against Government Waste. "What kind of example would this set if WorldCom is never fined for its actions?"

Editor's Note: So for now, the best way for any of you who have lost money in WorldCom stock to recoup that money is to offer your accounting services to the telecom giant as it seeks to "provide reasonable training and education to its senior operational officers and financial reporting personnel." Are there any Accounting 101 professors out there?