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CA's Kumar Awarded 12 Years Imprisonment

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DQI Bureau
New Update

Former chief executive of Computer Associates International,

Sanjay Kumar, was sentenced to 12 years imprisonment and $8 mn fine for

orchestrating a $2.2 bn accounting fraud at the software company.

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He had pleaded guilty in April to securities fraud and

obstruction of justice charges, and had faced a maximum sentence of life

imprisonment.

Kirby D Behre, a partner at the law firm of Paul, Hastings,

Janofsky & Walker and a former federal prosecutor, said he considered Kumar's

sentence stiff but just.

Kumar is the latest convicted chief executive to receive a

lengthy prison sentence in recent years.

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Jeffrey K Skilling, former chief executive of Enron, was

sentenced to 24 years and four months imprisonment, while Bernard J Ebbers last

year received 25 years imprisonment.

CAI had tremendous success during the 1990s, largely under the

leadership of Kumar and the company's founder, Charles B Wang. Kumar was

compensated handsomely in return: in 1998, he netted a $330 mn bonus, one of the

largest paydays of any American executive.

Kumar arrived in the United States at the age of 14 after his

family fled Sri Lanka. Joining Computer Associates in 1987 at the age of 25,

Kumar earned promotions quickly: he became president and chief operating officer

in 1994, and in 2000 he assumed the role of chief executive. Two years later, he

added the title of chairman after Wang resigned.

But as the government's investigation stepped up, Kumar came

under scrutiny. Details have since emerged of the dubious accounting practices

that helped fuel Computer Associates' once-soaring stock price.

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