Judge taps CA watchdog
Manhattan lawyer Lee Richards picked as firm's independent examiner, as
part of Computer Associates' agreement
BY ROBERT E. KESSLER AND MARK HARRINGTON
STAFF WRITERS
March 17, 2005
A former federal prosecutor has been named to ensure that Computer
Associates cleans up its operation in line with a court agreement that
headed off a federal criminal indictment of the firm for fraud.
Lee Richards, a Manhattan attorney, was selected yesterday to be the firm's
independent examiner by U.S. District Court Judge I. Leo Glasser, officials
said.
In addition to being a former federal prosecutor in the Southern District
who investigated insider trading and securities fraud cases, Richards also
has worked for the Securities and Exchange Commission overseeing the
compliance or liquidation of several securities firms.
U.S. Attorney Roslynn Mauskopf said, "One of the primary purposes of [the CA
agreement] was to ensure that, going forward, CA meets the highest standards
for accounting, internal compliance, corporate governance and ethics. ...
Lee Richards will be bringing his wealth of experience and judgment to
helping ensure that those purposes are achieved."
In private practice recently, Richards most notably served as the attorney
for Salomon Smith Barney telecom analyst Jack Grubman. Grubman, described by
research firm The Corporate Library as a "poster boy for Wall Street
conflicts of interest and shady dealings," was banned from the business for
life and fined $15 million. Grubman, however, neither admitted nor denied
the charges against him.
In a statement, Computer Associates said the firm "is committed to
fulfilling all the requirements of the [agreement] and has already made
important progress. With Mr. Richards' guidance, CA hopes to accelerate this
process."
Richards was selected in a complicated process in which CA named at least
five attorneys it said would be acceptable to oversee the firm's cleanup.
The U.S. attorney's office then whittled the list down to three, and the
judge made the final selection.
Under the terms of the cleanup agreement last September, known as a deferred
prosecution, Computer Associates paid $225 million to compensate defrauded
investors and said it would fire all employees responsible for wrongdoing,
appoint new management, add several independent directors to its board, and
reorganize the finance department to ensure tighter supervision of financial
practices.
Copyright © 2005,
Newsday, Inc.
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