Wednesday, November 21, 2012

Fraud? H-P Says It Was Duped, Takes $8.8 Billion Charge




Was it a deal they couldn't refuse or as Hewlett-Packard said on Tuesday it had been duped into overpaying for one of its largest acquisitions, contributing to an $8.8 billion write-down and a huge quarterly loss.   In an interview with The Wall Street Journal, Autonomy founder Mike Lynch said he wasn't aware Hewlett was preparing these allegations and that they are "utterly wrong.

"There appears to have been a willful sustained effort" to inflate Autonomy's revenue and profitability, said Chief Executive Meg Whitman. "This was designed to be hidden."  Michael Lynch, Autonomy's founder and former CEO, fired back hours later, denying improper accounting and accusing H-P of trying to hide its mismanagement. "We completely reject the allegations," said Mr. Lynch, who left H-P earlier this year. "As soon as there is some flesh put on the bones we will show they are not true…."

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