Tyco Ex-Exec Thought Perks Were OKd

Tyco International Ltd.’s former head of human resources testified Wednesday that she thought at the time that the company’s board was aware of millions of dollars in loan forgiveness awarded to top executives L. Dennis Kozlowski and Mark Swartz in 2000.

Patricia Prue, senior vice president of human resources at the Bermuda-based company from 1998 to 2002, said Swartz, Tyco’s former chief financial officer, and Kozlowski, the former chief executive, told her that Phil Hampton, head of the compensation committee, had signed off on the loan forgiveness.

Prosecutors have alleged that Kozlowski and Swartz, who are on trial in New York Supreme Court, granted themselves more than $48 million in loan forgiveness and payments to cover taxes, known as “gross ups,” in 2000 at Tyco without authorization from the company’s compensation committee or board of directors. The two men have denied wrongdoing.

Asked whether Hampton had granted Kozlowski $32 million in loan forgiveness and gross ups, Prue replied in court: “I didn’t have any conversation with Mr. Hampton on the subject.”