On the heels of a pair of settlements to resolve the company's $2.2 billion accounting scandal, two former top executives of software maker Computer Associates International Inc. pleaded not guilty to criminal charges.
According to published reports, former chief executive Sanjay Kumar, 42, and former executive vice president of sales Stephen Richards, 39, both pled not guilty before U.S. District Judge I. Leo Glasser in Brooklyn.
Each was charged with 10 counts of securities fraud, conspiracy and obstruction of justice. The indictment charged that Kumar and Richards schemed with other executives to fraudulently report revenue associated with license agreements that hadn't been finalized through a practice which involved artificially extending months.
Glasser released both men on $5 million personal recognizance bonds secured by their homes, restricted their travel to within the United States, and ordered them to refrain from contacting a list of witnesses. A pre-trial conference is scheduled for late November.
Kumar faces a maximum of more than 100 years in prison and millions in fines if convicted of all charges, according to reports.
Under deals announced last week that allow it to defer prosecution by 18 months and which resolve investigations by both the Department of Justice and the Securities and Exchange Commission, CA agreed to establish a restitution fund of $225 million to compensate shareholders; to help investigators recover compensation from present or former officers or employees who engaged in improper conduct while employed at the company; to strengthen its corporate governance, management team, and financial reporting and processes, and to enhance its compliance and ethics training.
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