Sanjay Kumar charged with securities fraud

By siliconindia staff writer   |   Thursday, 23 September 2004, 19:30 IST
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NEW YORK: Former Computer Associates International Inc chief executive Sanjay Kumar was charged on Wednesday with securities fraud and obstruction of justice stemming from a two-year investigation of improper accounting at the software maker. The company itself cut a deal with regulators on Wednesday promising to pay $225 million to shareholders to settle federal accounting fraud charges, as the government accused it of improperly booking $2.2 billion in revenues. A federal court, which heard a guilty plea from a former CA officer on Wednesday, approved an agreement the could mean the company avoids prosecution. It is allowing CA 18 months to pay the fine and put a number of remedial policies in place. Kumar and former global sales chief Stephen Richards were charged in a 10-count indictment that was returned by a grand jury last Friday and unsealed on Wednesday. The charges include securities fraud, conspiracy and obstruction of justice. Richards was also charged with one count of perjury, while Kumar was charged with one count of making false statements to law enforcement officers. Kumar's attorneys said in a statement that he "denies any wrongdoing and expects to be exonerated of all charges." Richards' lawyers said the government "overreached" as he was not responsible for determining "when revenue was recognized."

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