Former Tyco Attorney Acquitted
Tyco International Ltd.’s former general counsel, Mark Belnick, was acquitted Thursday of securities fraud and grand larceny in connection with his role as the top attorney at the conglomerate.
The jury’s verdict, which came on the fifth day of deliberations, marks another setback for prosecutors who have spent more than two years investigating and trying cases against onetime executives of Tyco.
Experts considered the case against Belnick shakier than the first one against Tyco executives, involving former Chief Executive L. Dennis Kozlowski and former Chief Financial Officer Mark Swartz.
The trial of Kozlowski and Swartz, which included salacious details about an extramarital affair and a lavish party, ended in a mistrial in April after a juror received a suspicious letter and telephone call during deliberations.
With Belnick’s family and friends crowding the courtroom Thursday, the jury cleared him of charges that he cheated shareholders, stole millions of dollars from the company and falsified business records.
Belnick broke down in tears after the verdict was read, hugging his wife and daughter.
“I feel terrific,” he later told reporters outside the courthouse. “Right now I just want to take a deep breath and go home.”
The case largely centered on $32 million in bonuses and loans Belnick received at Tyco, payments that prosecutors said were hidden from shareholders and the board of directors.
During the trial at New York Supreme Court in Manhattan, prosecutors charged that Belnick received a $17-million bonus from Kozlowski for helping the CEO cover up suspicious payments to his girlfriend.
They also contended that Belnick should have disclosed nearly $15 million in loans he received for moving.
Over several days on the witness stand, Belnick denied the charges, telling jurors that he understood the loans did not have to be disclosed in papers filed with regulators. He also testified that because Kozlowski approved the loans, he believed that the board was fully informed.
When asked about the $17-million payment, Belnick testified that it was for his work in resolving an accounting investigation by the Securities and Exchange Commission.
“Every dollar I received at Tyco I earned,” Belnick testified. “Every dollar I received was authorized.”
A spokeswoman for the Manhattan district attorney’s office said the “jury has reached its verdict and of course we accept it,” but did not comment further.
