CA’s former CEO gets 12 years in prison in accounting scheme
Sanjay Kumar, the former chief executive of CA Inc., was sentenced to 12 years in federal prison Thursday for his role in a $2.2-billion accounting fraud at the computer software company that cost its shareholders more than $400 million.
U.S. District Judge I. Leo Glasser also fined the former CEO $8 million at a hearing in federal court in Brooklyn.
Kumar, 44, pleaded guilty to charges including conspiracy, securities fraud and obstruction of justice in April just two weeks before his trial was due to start.
He had faced life in prison under federal sentencing guidelines, but Glasser said that would be an unreasonable punishment for a financial fraud.
Kumar had improperly booked software license revenue from 1999 to 2000 to meet Wall Street analysts’ profit expectations and then lied to investigators about it, the government said.
“I know that I was wrong and there was no excuse for my misconduct,” Kumar told the judge. “I’ve tried my best to work hard, help others in need and be a good family man.”
His lawyers made a lengthy appeal for leniency, citing Kumar’s charitable works. They also said CA was not heavily damaged by the scheme.
“This is not a case where the fraud affected the fundamental health of the company,” defense attorney Robert Fiske said.
Making the government’s appeal for a stricter punishment, Assistant U.S. Atty. Eric Komitee said Kumar’s actions represented “the most brazen and comprehensive obstruction in the modern era of corporate crime.”
CA, previously known as Computer Associates International Inc., restated its results for fiscal 2001 through 2004 after Kumar left the Islandia, N.Y.-based company in 2004 after a career that spanned nearly two decades.
CA’s chief financial officer, the head of worldwide sales, the general counsel and three other executives previously had admitted their guilt related to the accounting scandal.
CA also agreed to pay $225 million in shareholder restitution and continues to cooperate with the government as part of a deferred prosecution deal.
