CA fires nine employees, closes in on CEO Kumar

20 April 2004 Computer Associates has fired nine people from its legal and finance departments, while claiming that the long-running criminal probe into its accounting practices is “nearing completion”.


Fourteen employees have now been dismissed or pleaded guilty to crimes as a result of the investigation, including the company’s former chief financial officer Ira Zar, who recently pleaded guilty to charges of obstruction and securities fraud.

All attention now points towards the software company’s chairman and CEO Sanjay Kumar, whose future will be decided by the CA board today. Kumar’s lawyers have refused to comment on speculation that Kumar could be ousted, claiming that Kumar has done nothing wrong.

However some analysts doubt whether Kumar can survive the investigation. They argue that since Zar reported directly to Kumar, Kumar either knew about the conspiracy or was negligent for not knowing.

“Knowing what was happening, or not knowing what was happening, what’s the worse of the two evils?” asked Bank of America Securities analyst Robert Stimson in The New York Times. “The major shareholders we talk to right now want finality, want clarity; they want this to end,” he added.

Besides Kumar, several other senior executives at CA are under investigation and could be forced out, according to a number of people who have been briefed on the board’s plans.

Of the unnamed employees dismissed yesterday, eight were based at the company headquarters in New York State; the ninth worked in Atlanta, Georgia. CA alleged that they were fired “as a result of issues raised” by an internal investigation, which is being overseen by the board’s audit committee.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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