Agents may potentially misrepresent the firm and act in ways that favor their career rather than complying with the goal of the firm; that is maximizing the wealth of the stockholder, through maximizing the stock price

Worldcom scandal was one of the primary scandal in the accounting world which is is seen as fraud by the management of the company and cheating the shareholders of the company as they overstated their assets by 11 billion dollars and it will mean that they were trying to misrepresent their books of accounts and they were trying to show that they have better creditworthiness and higher strength than they actually had, so it led to a higher degree of panic in the financial market because of the fraud and it eventually led to downfall of the company because of these misrepresentation and frauds.

There was a high degree of of misrepresentation of books of accounts and cheating of the investors which is representing an agency problem and management did not act in the best interest of principal and they inflated the books of accounts for reporting higher profits.

Hence it was a reflection of agency problem and fraud by management.