MCI cleared a big stumbling block from its path to recovery Monday, agreeing to pay a record fine in a settlement with stock market regulators.The Ashburn, Va., telecom giant, formerly known as WorldCom, said it would pay $500 million to settle civil fraud charges stemming from the accounting irregularities that drove the No. 2 long-distance provider into Chapter 11 bankruptcy last summer. The proposed settlement with the Securities and Exchange Commission comes less than a year after the alleged fraud came into public view, paving the way for a quick disposition of the high-profile case. U.S. District Judge Jed Rakoff, who is overseeing the WorldCom case, is expected to hear further discussion on the terms of settlement and make his final ruling at a June 11 hearing. Given the magnitude of WorldCom's $11 billion accounting misdeeds and the fact that its $104 billion in assets made it the country's largest bankruptcy, some observers were inclined to regard the fine as too small. But the SEC and legal experts point out that the settlement dwarfs the agency's largest previous civil fraud settlement, a $10 million deal with Xerox.