Former CFO indicted for fraud after HP takeover
The former chief financial officer of a British software company is facing fraud charges in federal court in San Francisco for allegedly issuing false and misleading statements about his company’s financial condition before Hewlett-Packard Co.’s $11 billion takeover in 2011.
Sushovan Hussain, 52, a British citizen who was CFO of Autonomy Corp., was indicted by a federal grand jury on Thursday.
He is charged with one count of conspiring to commit wire fraud between 2009 and 2011 and 14 counts of committing wire fraud in emails, video conferences, telephone conferences and press releases transmitted in 2011.
Palo Alto-based Hewlett-Packard bought Autonomy, which specialized in the analysis of so-called “big data,” for $11 billion in October 2011.
A year later, Hewlett-Packard wrote off $8.8 billion of the acquired company’s supposed value.
The indictment alleges that Hussain and unnamed others:
“… engaged in a fraudulent scheme to deceive purchasers and sellers of Autonomy securities and HP about the true performance of Autonomy’s business, its financial condition and its prospects for growth.”
The alleged fraud was carried out by artificially inflating the company’s revenue; issuing false and misleading statements to its auditors, regulators and market analysts; and issuing false and misleading quarterly and annual reports, the indictment contended.
If convicted, Hussain could face a sentence of up to 20 years in prison on each count.
No court date for an appearance by Hussain has been set. He is in the United Kingdom and U.S. prosecutors could ask for his extradition if he does not voluntarily come to San Francisco to face the charges.
U.S. Attorney’s Office spokesman Abraham Simmons declined to comment on next steps in the case.
When asked whether there will be an extradition proceeding, David Satterfield, a spokesman for defense attorney John Keker, said, “We don’t yet know and have no comment” on that question.
Keker said in a statement:
“Sushovan Hussain is innocent of wrongdoing. He defrauded no one and, as Autonomy’s CFO, acted at all times with the highest standards of honesty, integrity and competence. He will be acquitted at trial. … It is a shame that the U.S. Department of Justice is lending its support to HP’s attempts to blame others for its own catastrophic failings.”
“Mr. Hussain is a U.K. citizen who properly applied U.K. accounting rules for a U.K. company. This issue does not belong in criminal court in the United States.”
In 2015, Hewlett Packard split into two companies, HP Inc. and Hewlett-Packard Enterprise.