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CA's Mea Culpa

Computer Associates International Inc. (CA) (NYSE: CA) has finally drawn a line under the accounting scandal that has dogged the company for the last 12 months. But though it's reached a settlement with the Department of Justice (DOJ) and Securities and Exchange Commission (SEC), the fallout continues.

The companys former CEO Sanjay Kumar and one-time head of worldwide sales Stephen Richards have been indicted on securities fraud conspiracy and obstruction charges, it was announced today. Richards was also charged with one count of perjury, and Kumar with one count of making false statements to law enforcement officers.

If convicted on all counts, the former execs each face a maximum prison sentence of 100 years.

According to the indictment, in fiscal year 2000, Kumar and Richards allegedly took part in a company-wide accounting fraud known as the “35-day month." The goal of the scheme was to permit CA to report that it had met or exceeded its projected quarterly revenue and earnings when it had not, according to the DOJ.

Earlier today, Stephen Woghin, CA’s former general counsel and senior vice president, pleaded guilty to securities fraud conspiracy and obstruction of justice charges, and now faces a maximum sentence of 25 years. Four other former CA execs had previously pleaded guilty to charges arising out of the investigation.

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