Archive for Tuesday, April 25, 2006

Executive pleads guilty to fraud

Former Computer Associates leaders await sentencing in scandal

April 25, 2006

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Sanjay Kumar, former CEO of Computer Asssociates International Inc. exits Brooklyn federal court, Monday, April 24, 2006, in New York. Kumar and another former executive, Stephen Richards, pleaded guilty on Monday to obstruction of justice and securities fraud charges in a massive accounting scandal at the business software company.

Sanjay Kumar, former CEO of Computer Asssociates International Inc. exits Brooklyn federal court, Monday, April 24, 2006, in New York. Kumar and another former executive, Stephen Richards, pleaded guilty on Monday to obstruction of justice and securities fraud charges in a massive accounting scandal at the business software company.

— Sanjay Kumar, the former CEO of Computer Associates International Inc., and another former executive pleaded guilty Monday to obstruction of justice and securities fraud charges in a massive accounting scandal at the business software company.

Kumar and Stephen Richards, its former head of worldwide sales, had been accused in a 2004 indictment of engaged in a widespread scheme to falsely inflate the company's quarterly earnings by backdating contracts.

According to the indictment, Kumar was so involved with adding revenue to a financial quarter even after it closed that he flew to Paris in July 1999 to finalize a deal and personally signed a contract that had been backdated.

The indictment also charged that executives instructed salespeople to complete deals after the quarter had closed and "cleaned up" contracts by removing time stamps from faxes.

Richards pleaded guilty to the same charges in federal court in Brooklyn.

Both remain free on $5 million bond while awaiting their Sept. 12 sentencing.

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