CA's former chief jailed for 12 years

The former chief executive of one of the world's leading computing companies has been sentenced to 12 years in jail for committing securities fraud. Sanjay Kumar of Computer Associates, aged 44, has also been fined $8 million.

Kumar was chief operating officer of Computer Associates, now renamed CA, before becoming chief executive in 2001. He pleaded guilty earlier this year to securities fraud and to obstruction of justice.

The accounting scandal centred on the false inflation of quarterly results. Deals which were signed after a quarter ended were backdated so that they increased a preceding quarter's revenue. Kumar was found to be involved in that scheme.

An indictment from 2004 said that Kumar even flew to Paris in a private jet in order to sign a backdated contract in a $19 million deal.

Kumar was said to be instrumental in encouraging salespeople into operating a '35 day month', allowing deals to be completed after the close of a quarter. The practice led to the incorrect reporting of $2.2 billion worth of revenue. Executives at the company lied to an initial investigation and withheld evidence, the Government's case said.

Kumar was a protégé of CA founder Charles Wang, who resigned from the company as controversy surrounding the practice grew. Wang left the company with a $1 billion bonus that angered many shareholders.

Kumar has said that the 35 day month was in operation before he became chief executive. He left the company in 2004, having resigned as chief executive and acted as chief software architect for six weeks.

Kumar faced up to 20 years in jail, but received 12. Judge Leo Glasser said that Kumar, though not violent, "did violence to the legitimate expectations of shareholders."

The prosecution had claimed that heavy punishment was merited for a scheme that was "the most brazen in the modern era of corporate crime."

CA is the world's fifth biggest software company and makes software for large organisations. It employs 15,000.