Risk Management

For CA’s Kumar, Prison Must Wait

The man responsible for the "35-day month" is granted a little extra time on the outside, but only to work out the details of his restitution.
Dave Cook and Stephen TaubFebruary 13, 2007

Sanjay Kumar — who admitted his role in the $2.2 billion fraud at Computer Associates, where he was chief executive officer — has been granted a two-month reprieve from prison, according to published accounts.

Last April, reported Newsday, Kumar pleaded guilty to eight counts: securities fraud, conspiracy to commit securities and wire fraud, obstruction of justice, conspiracy to obstruct justice, making false statements to the FBI, and three counts of filing false statements with the Securities and Exchange Commission.

U.S. District Judge Leo Glasser sentenced him last November to 12 years in prison and ordered Kumar to pay a fine of $8 million. Though Kumar was not a violent criminal, Judge Glasser reportedly said at the time, he “did violence to the legitimate expectations of shareholders.”

Notoriously, Kumar and other executives at CA, as the software company is now known, were charged with instructing salespeople to complete deals after the quarter had closed — creating what company insiders came to call the “35-day month.”

Kumar had been scheduled to report to prison on February 27. But on Tuesday, reported Newsday, the judge pushed back that day of reckoning until April 24 so prosecutors and defense attorneys could work out the details of Kumar’s restitution.

According to the Long Island newspaper, Kumar’s assets have been frozen, and the company’s two largest shareholders are seeking the proceeds from the sale of his two Ferraris and his mansion in Oyster Bay, New York. CA has also reportedly secured an order that Kumar and his co-defendant, former chief of sales Stephen Richards, reimburse the company for nearly $15 million in legal fees.

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