FBI Probes Possible Criminal Accounting Fraud at HP Unit Autonomy
November 21, 2012 4:02 PM
comment(s) - last by
"Improprieties" may be code-speak for "crimes"
readers are dead on in their commentary. Responding to our report on Hewlett-Packard Comp.'s (
dire earnings guidance
due to accounting "improprieties" at recently acquired Autonomy,
Hewlett and Packard are turning in their graves. These "improprieties" sound like fishy criminal activities to me. How come no one is being held accountable. At the minimum, some fraud charges should be filed and somebody needs to do hard time. There is just no deterrence for things like this to repeat.
That comment proved prophetic as today the
U.S. Federal Bureau of Investigations
, working hand-in-hand with the
U.S. Securities and Exchange Commission
to investigate claims brought to it by HP.
In order for the SEC and FBI to investigate accounting errors, they must typically be criminal in nature and pertain to interstate or international offenses. HP reportedly personally requested the investigation after it was shocked to find out Autonomy had doctored its books in an apparent attempt to inflate its value.
The plan to
buy Autonomy for $10.3B USD
drew much criticism from analysts that argued HP was over-paying by at least twice what the UK enterprise software firm was worth. Léo Apotheker -- obsessed with
reforming HP to resemble his former employer
German enterprise software giant SAP AG (
), who gave him the boot shortly before his pickup by the HP -- ignored these glaring warning signs.
The board also shares some blame for failing to take heed of the warnings, as does new CEO Meg Whitman who completed the final stages of the purchase agreement shortly after taking over the reins after Mr. Apotheker was effectively fired for the second time in two years.
This Autonomy poster seems rather ironic in retrospect, considering the software company is alleged to have duped HP out of billions via bad accounting. [Image Source: Autonomy]
However, as much as HP failed to practice due diligence, if its side of the story is to be believed, Autonomy's leadership duped it with basically outright lies regarding improperly categorized hardware and other cleverly cooked books. HP estimates $3.8B USD of the $8.8B USD hit it took on the purchase were due to its own misreading of the software company's value, while the majority of it -- $5B USD was due to the possibly criminal "improprieties".
The FBI and SEC have not posted any official press releases confirming the probe, so at this point the only evidence of it are HP's
If Autonomy is indeed probed, it could take some time to investigate the misconduct as one of its two headquarters is located in Cambridge, UK, outside U.S. jurisdiction. Autonomy does have a second joint-headquarters in San Francisco, Calif. Thus far there have been
of any FBI raid on that location, as may later occur, if the reports of the probe are accurate.
This article is over a month old, voting and posting comments is disabled
11/23/2012 3:03:38 PM
Nothing like sticking to the issues of the story. Find someplace else to hate Ellison.
"Can anyone tell me what MobileMe is supposed to do?... So why the f*** doesn't it do that?" -- Steve Jobs
HP Posts Horrific Guidance, Will Take $8.8B USD Hit on "Improprieties"
November 20, 2012, 9:27 AM
IDF 2011 Exclusive: HP Discusses Spinoff Details
September 14, 2011, 5:10 PM
HP Looks to Dispose of TouchPads by Any Means Possible
August 19, 2011, 11:08 AM
Report: AT&T Eyeing $40B DirecTV Purchase
May 1, 2014, 8:00 AM
WebOS Class Action Settlement Costs HP $57 Million
April 1, 2014, 10:22 AM
IBM Workers Strike Over Terms of Deal That Will Have Them Working for Lenovo
March 6, 2014, 9:29 AM
Google Picking Up Artificial Intelligence Company "DeepMind" for $400 Million
January 27, 2014, 9:25 AM
Quick Note: Qualcomm Grabs up Palm, IPAQ, and Bitfone Patent Portfolio from HP
January 24, 2014, 9:18 AM
Verizon Buys Intel Media OnCue Cloud TV assets
January 21, 2014, 10:26 AM
Most Popular Articles
Lumia 830 Gets Major Upgrades Including New 20.1 Megapixel Toshiba Sensor
August 15, 2014, 6:00 PM
Windows Phone, BlackBerry Smartphone Market Share Falls to 2.5%, 0.5% Respectively
August 15, 2014, 9:44 AM
GM Concedes That the Cadillac ELR Doesn’t Really Compete with the Tesla Model S
August 15, 2014, 5:42 PM
Cell Phone Thief Calls 911 After Her Victim Chases Her and Her Male Cohort
August 14, 2014, 12:11 PM
Smarter Wired, Wireless Chargers Set to Shake Up Mobile Industry
August 14, 2014, 6:39 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information