In a trial that will be remembered for its tales of bloated extravagance, Tyco International Ltd.'s former chief executive and finance chief received sentences of up to 25 years in prison. The men will be eligible for parole after serving eight years and four months.Tyco's former chief executive, L. Dennis Kozlowski, 58, and former finance chief Mark Swartz, 44, were found guilty in June on 22 counts of grand larceny, falsifying business records, securities fraud and conspiracy - actions that prosecutors said involved both men giving themselves more than $150 million in illegal bonuses and forgiving loans to themselves, besides manipulating the company's stock price.
The jury deliberated for 11 days after the four-month trial. The original proceedings ended in a much-publicized mistrial.
New York State Supreme Court Justice Michael Obus ordered Kozlowski and Swartz to pay a total of $134 million in restitution; in addition, Kozlowski and Swartz were fined $70 million and $35 million, respectively. Kozlowski was employed by Tyco from 1975 until 2002, and Swartz worked for the company between 1991 and 2002. They testified that they never stole anything from Tyco or received anything to which they were not entitled. A centerpiece of their defense was that, unlike WorldCom and Enron, Tyco continued to thrive after the scandal.
Tyco, which has approximately 250,000 employees and $40 billion in annual revenues, makes electronics and medical supplies and owns the ADT home security business.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access