Former Autonomy boss charged over HP sale

null

Mike Lynch, former CEO of UK software giant Autonomy, has been charged with fraud in the United States. The charges are linked to the 2011 acquisition of the company by Hewlett-Packard and if found guilty, he could be looking at a 20-year fine. 

According to the BBC, Lynch is being charged with artificially inflating Autonomy’s revenues by overstating them. He also intimidated, pressured and paid off persons who raised complaints about or openly criticized Autonomy's financial practices and performance".

It was also said that Lynch wasn’t alone in this, as vice president of finance, Stephen Chamberlain, as well as ‘other conspirators’, were also in on the action. Former finance chief, Sushovan Hussain, was found guilty of accounting fraud.

Allegedly, Mr Lynch made $815m from the fourteen charges.

Lynch’s lawyers, Chris Morvillo of Clifford Chance and Reid Weingarten of Steptoe & Johnson, said they will "vigorously defend the charges". In a statement, they added that the indictment was "a travesty of justice", calling Lynch a "world-leading entrepreneur who started from nothing" who is now being nailed to the cross for HPE’s failures.

Autonomy specialised in analysis of large scale unstructured "big data", becoming the UK's largest and most successful software business by 2010. The company was acquired by Hewlett-Packard in 2011, for £7.4 billion. The deal came with a premium of around 79 per cent over market price that was widely criticized as "absurdly high", by the media.

Image source: Ken Wolter / Shutterstock