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Ex-Computer Associates financial chief gets 7 months prison, 7 months home detention

Ex-Computer Associates financial chief gets 7 months prison, 7 months home detention

CA Inc.'s former chief financial officer, Ira Zar, was sentenced Friday to seven months in prison and seven months home detention after pleading guilty to criminal charges and cooperating with prosecutors investigating a massive accounting fraud at the software company.
At a hearing in federal court in Brooklyn, U.S. District Judge I. Leo Glasser also ordered Zar, 45, to serve two years supervised release following the completion of his sentence. No fine was imposed and restitution will be determined at a later date.
"I am eternally sorry for my actions," Zar said prior to sentencing. "I accept full responsibility for my behavior."
Zar, who lives on Long Island, pleaded guilty to securities fraud and two counts of conspiracy in 2004.
He is scheduled to report to prison on April 30. His lawyer, Andrew Lawler, asked that Zar be housed at a satellite prison camp at the federal correctional institution in Otisville.
Prosecutors said at the hearing that Zar's cooperation was critical to their case and that his pending testimony was one of the factors that drove one-time Chief Executive Sanjay Kumar and Stephen Richards, the company's former sales chief, to plead guilty to criminal charges shortly before their case was scheduled to go to trial last year.
"His cooperation has really been stellar," Assistant U.S. Attorney Amy Walsh said.
Several former executives at the company once known as Computer Associates have pleaded guilty to criminal charges in the matter.
Kumar was sentenced to 12 years in prison in November after pleading guilty to securities fraud, obstruction of justice, conspiracy, making false filings to the Securities and Exchange Commission and making false statements.
Richards was sentenced to seven years in prison after pleading guilty to conspiracy, securities fraud, making false filings with the SEC, obstruction of justice and perjury.
The Islandia-based company itself avoided indictment by reaching a deferred prosecution agreement with the government in 2004 in which it agreed to pay $225 million (euro174 million) in shareholder restitution.
Lawler, Zar's lawyer, said Zar makes "no excuses" for his conduct, but noted a letter written in support of Zar in which the letter writer said Zar was "someone who became blindly loyal to a company that had lost its way."
"His entire career and his success was a result of the people he reported to as CFO," Lawler said. "When the time came that he should have said no and should have walked away, he didn't. That's why he stands here today."
Lawler said that Computer Associates was the only company Zar had ever worked for and the only corporate culture he had ever been exposed to. Zar joined the company after college a few days short of his 21st birthday and worked there 22 years.
Prosecutors have alleged Kumar and other executives engaged in a scheme to artificially boost the company's quarterly results by backdating software contracts to make it appear the license agreements had been signed during the quarter.
The practice was referred to internally as the "35-day month" because it involved artificially extending reporting months, usually the last month of a fiscal quarter, the government said.
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Chad Bray is a correspondent of Dow Jones Newswires


Updated : 2021-04-14 10:53 GMT+08:00