Tech

HP wins major fraud case against Mike Lynch of Autonomy


After many years Outraged, HP won a civil fraud lawsuit against Autonomy founder and CEO Mike Lynch. The ruleThe largest civil fraud trial in UK history, could also raise the possibility of Lynch being extradited to the United States, where he faces other fraud charges.

The UK’s Supreme Court found that HP had “significantly succeeded” in proving that Autonomy executives had fraudulently inflated reported revenue, earnings and value. of the company. HP paid the company $11 billion in 2011 and later announced a $8.8 billion reduction in value. In court, HP asked for $5 billion in damages, but the judge said the total amount to be paid would be “significantly less” and would be announced at a later date. In parallel with the court’s decision, an earlier judicial review set a deadline of midnight on January 28 for UK Home Secretary Priti Patel to make a decision on Lynch’s extradition to the United States. Ky.

This week’s events are the latest turning point in the extradition process that began in November 2019, when the US Embassy in London sent a request for Lynch to face trial in the United States on 17 counts, including electrical fraud, conspiracy and securities fraud. Lynch denies all charges against him. Nicholas Ryder, professor of financial crime at the University of the West of England, describes it as the “Colt-45 for the US Department of Justice”—a move that was pervasive and powerful. “That’s how they charge. The divide for Mr. Lynch is substantial. ”

At the time of the Autonomy acquisition, HP’s then-president said he was “seriously cold-hearted” about the deal, according to statements later made in court. The the company claims Several former members of Autonomy’s management team “used accounting misrepresentations, misrepresentations and disclosure errors to inflate the underlying financial ratios of the company.” [Autonomy]. Among them was Lynch, then the CEO of the company.

In 2015, HP File a lawsuit in the United Kingdom against Lynch, accusing him of being involved in publishing false accounts that overstate Autonomy’s business value. Now, more than a decade after the ink dried on the deal, and nearly seven years after Lynch was taken to court, the UK civil case is complicated by a parallel case involving the US Department of Justice. Period — the ramifications can be huge for Lynch. In a related trial, his former colleague at Autonomy, chief financial officer Sushovan Hussain, had convicted of fraud in a US court in May 2019, was sentenced to 5 years in prison and fined $4 million, as well as ordered to pay an additional $6.1 million.

In July 2021, a London court ruled that Lynch could be extradited, with the judge saying the UK civil case outcome would have “very limited relevance” to the case. of the United States. Since then, Patel has delayed signing an extradition request against someone currently on trial in the UK for similar offences. But now that case is coming to an end — and Lynch may be running out of options. “He could face a significant amount of time in prison if convicted of 17 counts of fraud,” Ryder said.



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