Sanjay Kumar ex-CEO of CA gets 12 years in Prison !
Just read a small news article on Google news today which said Sanjay Kumar, ex-CEO of CA (Computer Associates) was sentenced yesterday to 12 years in prison for orchestrating a $2.2 billion accounting fraud at the software company. He was also fined $8 million. Given the recent history of Enron, Tyco and MCI frauds, this did not surprise me. But it got me thinking…10 years ago when I first read Sanjay Kumar’s name mentioned as a top executive of CA, I was impressed as he was young, seemed Indian and was heading a high-profile company. Later when I read his biography, I came to know he was from Sri Lanka. But still, he had the guy next door image who made it big. For many years thence, I kept reading his name on several news papers and Tech magazines and was suitably impressed. I did feel the Indian news media was biased towards him and was subconsciously promoting him.
He was looking at a life sentence and has gotten away lightly, compared to Jeff Skilling, ex-CEO of Enron who got 24 years and 4 months.
Sanjay Kumar will still be young (56) when he is released, so he may yet have life after prison. Sad nevertheless.
Labels: CA, Computer Associates, Sanjay Kumar
posted by Ravi | 7:47 PM
1 Comments:
Sanjay Kumar not only defrauded stockholders but his employees. At the end of June 2000 (?) he met with the Wall Street analysts and gave them glowing reports of 2nd Qtr earnings. This was the begining of a long holiday (4th of July) weekend. It was also the purchase date of CA stock for employees who had deductions made from their paychecks for the previous 6 months. The stock was trading at about 72 dollars per share. The next day (the market was closed and the analyst had left for the beach) CA announced that they would not hit their 2nd quarter goals. When the analysts returned, betrayed by CA, they recomended that everyone sell CA and the price dropped by half. All employees who had participated in the stock purchase plan saw their savings cut in half after owning the stock over the weekend. This is why the entire alumnus of CA employees was hoping and praying that in some small way their betrayal would be vindicated by having Sanjay go to jail for a long,long,long time. I'm not sure if 12 years is enough, but it's a nice start.
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