A U.S. District Court judge has ordered the former CEO of CA to pay more than $1 billion in restitution to victims of securities fraud he committed while at the company.
CA has already repaid $225 million of that amount to a victim's fund. Sanjay Kumar must pay $52 million in the next 18 months, Judge I. Leo Glasser of the U.S. District Court for the Eastern District of New York, ordered Friday.
Glasser also released Kumar from an $8 million fine imposed in November while he is making restitution. Kumar was also sentenced to 12 years in prison after pleading guilty to obstruction of justice and securities fraud charges.
After his prison sentence is completed, Kumar must pay 20 percent of his income each year toward the remaining $746 million in restitution, Glasser ordered. The court does not expect the total amount to be repaid, a spokesman for the U.S. Attorney for the Eastern District of New York said.
Kumar and Stephen Richards, the company's former worldwide sales head, both pleaded guilty after they were accused of fraudulent accounting practices, including falsely reporting hundreds of millions of dollars in revenue for licensing agreements during fiscal quarters in which the deals had not yet been finalized.
In early 2000, CA signed a $44.5 million license deal with a nearly insolvent customer in which it had an ownership stake, according to court records. It then back-dated the contract so it could be recorded in the prior quarter. In the next quarter, CA reversed the revenue in its internal records but did not publicly restate its results.
The company also changed its name -- during the time Kumar was at the helm it was called Computer Associates International.
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Comments (1)
Sanjay KumarBy Anonymous on April 13, 2007, 2:05 pmHow much did Uncle Charlie make off of CA stock after he left CA to Mr Kumar? Re: Kumar erased evidence from his hard drive, U.S. says.
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