Go to the Globe and Mail homepage

Jump to main navigationJump to main content

A logo of HP is seen outside Hewlett-Packard Belgian headquarters in Diegem, near Brussels, in this Jan. 12, 2010, file photo. (THIERRY ROGE/REUTERS)
A logo of HP is seen outside Hewlett-Packard Belgian headquarters in Diegem, near Brussels, in this Jan. 12, 2010, file photo. (THIERRY ROGE/REUTERS)

Autonomy’s Lynch defends record as HP confirms Federal probe Add to ...

Mike Lynch, the founder of the software firm sold to Hewlett-Packard last year in a deal tainted by accusations of accounting fraud, said he would defend the company’s accounts to U.S. Federal investigators.

HP confirmed in a filing late on Thursday that the U.S. Department of Justice was investigating Autonomy’s books.

More Related to this Story

The PC and printer maker bought the British company for $11 billion last year to lead its push into the more profitable software sector.

Autonomy did not deliver the growth expected, resulting in Mr. Lynch’s departure earlier this year.

But worse was to come last month when HP wrote off some $5 billion of the company’s value and accused its former management of accounting improprieties that inflated its value.

The Silicon Valley company said it had passed information from a whistleblower to the U.S. Department of Justice, the SEC and Britain’s Serious Fraud Office.

“On November 21, 2012, representatives of the U.S. Department of Justice advised HP that they had opened an investigation relating to Autonomy,” it said in the filing.

“HP is co-operating with the three investigating agencies.”

Mr. Lynch launched a robust defence of his track record almost immediately after HP made the accusations.

He said on Friday that he was still waiting for a detailed calculation of HP’s $5 billion writedown of Autonomy’s value and a published explanation of the allegations.

“Simply put these allegations are false, and in the absence of further detail we cannot understand what HP believes to be the basis for them,” he said in a statement.

“We continue to reject these allegations in the strongest possible terms. Autonomy’s financial accounts were properly maintained in accordance with applicable regulations, fully audited by Deloitte and available to HP during the due diligence process.”

Mr. Lynch said he had not been approached by any regulatory authority, but he would co-operate with any investigation and looked forward to the opportunity to explain his position.

HP has refused to concede to Mr. Lynch’s demands for more information about the allegations.

“While Dr. Lynch is eager for a debate, we believe the legal process is the correct method in which to bring out the facts and take action on behalf of our shareholders,” it said in response to an open letter from Mr. Lynch last month

“In that setting, we look forward to hearing Dr. Lynch and other former Autonomy employees answer questions under penalty of perjury.”

Follow us on Twitter: @GlobeInvestor

 
Security Price Change
HPQ-N Hewlett-Packard Co. 35.04 0.06
0.172 %
Add to watchlist
Live Discussion of HPQ on StockTwits
More Discussion on HPQ-N

More Related to this Story

Topics:

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories