CA accounting scandal raises questions about CEO's fate

[Renew Deal]

Questions linger about CEO Sanjay Kumar's involvement in CA's accounting manipulations

By Stacy Cowley, IDG News Service April 19, 2004

Following a wave of indictments this month that netted guilty pleas to securities fraud and other charges from several former finance executives at Computer Associates International Inc. (CA), speculation is turning to the fate of the company's chief executive officer (CEO).

CA has already admitted to improper accounting practices in its 2000 fiscal year that were under investigation by the U.S. Securities and Exchange Commission (SEC) and U.S. Department of Justice (DOJ). The company has since revamped its accounting methods, replaced most of its board and pushed out a number of executives tainted by fraud. But one executive from that era, Sanjay Kumar, now serves as the company's CEO. And questions linger about the then-president and chief operating officer's involvement in CA's accounting manipulations.

The DOJ complaint against Ira Zar, CA's chief financial officer (CFO) until last October, charges that he regularly met with two other unnamed "high-level" executives who allegedly knew and approved of the financial sleight of hand. Zar at the time reported directly to Kumar, who in turn answered to then-Chairman and CEO Charles Wang, a company co-founder who has since retired.

The DOJ is continuing its investigation in conjunction with the SEC, and speculation in the IT and financial sectors persists that Wang and Kumar may be targets of future actions.
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http://www.infoworld.com/article/04/04/19/HNcascandal_1.html