Log In

Reset Password

Former CEO jailed for 12 years

NEW YORK (Bloomberg) — CA Inc.’s former chief executive officer Sanjay Kumar was yesterday sentenced to 12 years in prison for leading a $2.2 billion accounting fraud at the software maker.US District Judge I. Leo Glasser imposed the prison sentence and an $8 million fine today in Brooklyn, New York, and ordered Kumar, 44, to report to a federal prison by February 27. Kumar pleaded guilty in April to charges including conspiracy, fraud and obstruction of justice.

“His cupidity calls for a meaningful sentence,” the judge said, noting he didn’t impose the maximum sentence called for by advisory federal sentencing guidelines, life in prison.

The sentence fell short of the longest recent prison terms for executives convicted in the crackdown on corporate fraud after the collapse of Enron Corp. in 2001.

Bernard Ebbers, WorldCom chairman, got 25 years; Jeffrey Skilling, former Enron Corp. CEO, more than 24 years; John Rigas, Adelphia Communications Corp. founder, 15 years; and L. Dennis Kozlowski, former chairman and CEO of Tyco International Ltd., as long as 25 years.

Prosecutors said Kumar and other CA executives backdated contracts to inflate revenue at the Islandia, New York-based company, formerly Computer Associates International Inc., the world’s second-largest maker of mainframe computer software.

“I apologize to the court for my mistakes and conduct,” Kumar told the judge.

Glasser refused to give credit to Kumar for accepting responsibility or pleading guilty to all eight counts, which might have reduced his sentence.

“That consideration is not warranted,” the judge said, noting that Kumar pleaded guilty almost on eve of his trial and still contested his involvement in erasing his laptop’s memory after learning of an investigation at CA.

A co-defendant of Kumar’s, former CA sales executive Stephen Richards, 41, also pleaded guilty in April. He is to be sentenced November 14. Neither man was promised leniency as part of the plea.

Assistant US Attorney Eric Komitee said Kumar deserved a long prison term because the fraud cost investors as much as $3.5 billion as news of the scandal caused company shares to plummet.

Kumar engaged in a series of obstructionist acts, including wiping his computer’s hard drive clean after the company told him to preserve evidence for a federal investigation, the prosecutor said.

Kumar authorised paying $3.7 million to buy the silence of a potential witness, Komitee said.

Defence lawyers asked Glasser for a light prison sentence followed by community service, citing their client’s philanthropy.

“Kumar has already been severely punished,” attorney Robert Fiske Jr. told the judge. “His actions have brought shame to his family.”