November 2, 2006 9:50 AM PST

Former CA exec Kumar sentenced to 12 years

update Former CA chief executive Sanjay Kumar was sentenced on Thursday to 12 years in prison and ordered to pay an $8 million fine for his part in a long-running bookkeeping scandal at the management software provider.

Kumar is one of several former senior executives at the company, formerly known as Computer Associates, charged in connection with premature reporting of $2.2 billion in software licensing revenue and the use of a fraudulent accounting scheme designed to make it appear as if the company was meeting quarterly expectations in 1999 and 2000.

The scheme resulted in a shareholder loss of more than $400 million, according to a statement released by the U.S. Attorney's office. The company had previously paid $225 million to settle with federal prosecutors.

Sanjay Kumar
Sanjay Kumar

"The sentence imposed today sends the message that accounting fraud is a serious crime and that obstructing justice will inevitably make things worse, not better, for defendants under investigation," U.S. Attorney Roslynn R. Mauskopf said in a statement.

At Thursday's sentencing, Judge I. Leo Glasser, of the New York Eastern District court in Brooklyn, was also informed that Kumar had tampered with a laptop to conceal incriminating contents, according to a statement from the U.S. Attorney's office.

"Kumar has also admitted obstructing the government's investigation by lying to federal investigators, and by directing Computer Associates' employees to provide false explanations for the fraudulent accounting practices to the government," the statement said.

Kumar has until Feb. 27 to get his affairs in order before reporting for federal prison, under the terms of the sentence set by Glasser. At that time, Glasser will also set the amount of restitution to be paid to victims, according to a spokesman for the U.S. Attorney's office.

Kumar was also given three years of supervised release for each of the eight counts to which he pleaded guilty.

Kumar was indicted in September 2004 for crimes that included securities fraud, obstruction of justice and false statements. In federal court in April 24, Kumar pleaded guilty to all of the charges for which Glasser sentenced him on Thursday.

Earlier this year, Thomas Bennett, a former senior vice president at CA, pleaded guilty to obstruction of justice, and Stephen Richards, a sales executive, pleaded guilty to securities fraud conspiracy and obstruction of justice.

The company's former general counsel, Stephen Woghin, pleaded guilty to fraud and obstruction of justice in September 2004.

See more CNET content tagged:
Sanjay Kumar, obstruction, justice, accounting, Computer Associates International Inc.

 

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