Computer_Associates_Fraud - Press Release SEC Files...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Home | Previous Page SEC Files Securities Fraud Charges Against Computer Associates International, Inc., Former CEO Sanjay Kumar, and Two Other Former Company Executives FOR IMMEDIATE RELEASE 2004-134 Company Agrees to Settlement with SEC and Justice Department Including $225 Million in Restitution and Corporate Governance Reforms Washington, D.C., Sept. 22, 2004 — The Securities and Exchange Commission today announced securities fraud charges against Computer Associates International, Inc. and three of the company's former top executives — Sanjay Kumar, former CEO and Chairman, Stephen Richards, former Head of Sales, and Steven Woghin, former General Counsel. The SEC alleges that from 1998 to 2000, Computer Associates routinely kept its books open to record revenue from contracts executed after the quarter ended in order to meet Wall Street quarterly earnings estimates. In total, Computer Associates prematurely recognized $2.2 billion in revenue in FY2000 and FY2001 and more than $1.1 billion in premature revenue in prior quarters. In addition, Computer Associates, through former executives Kumar, Richards and Woghin and others, obstructed the SEC's investigation into the company's accounting practices. Computer Associates has agreed to settlements with the SEC and the Justice Department in which the company will pay $225 million in restitution to shareholders and will make reforms to its corporate governance and financial accounting controls. Woghin has agreed in a partial settlement to a permanent injunction and officer and director bar with monetary sanctions to be decided at a later point. Mark K. Schonfeld, Director of the SEC's Northeast Regional Office, said, "Like a team that plays on after the final whistle has blown, Computer Associates kept scoring until it had all the points it needed to make every quarter look like a win. With these charges we have demonstrated our commitment to hold the highest levels of management responsible for fraud on the company's shareholders." Alexander M. Vasilescu, Senior Trial Counsel in the SEC's Northeast Regional Office, added, "The combined actions of the SEC and the Justice Department, including the $225 million in restitution, should send a clear message that public companies will pay a heavy price for obstructing the government's investigation." The SEC's complaints, filed in the United States District Court for the Eastern District of New York, allege as follows:
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/01/2009 for the course AEM 2210 taught by Professor Little,j. during the Spring '07 term at Cornell.

Page1 / 4

Computer_Associates_Fraud - Press Release SEC Files...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online