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Tech

CSC to pay $190 million over accounting charges

Barb Darrow
By
Barb Darrow
Barb Darrow
Barb Darrow
By
Barb Darrow
Barb Darrow
June 5, 2015, 11:56 AM ET
4.1.1
4.1.1Courtesy of Computer Sciences

It’s now official. Tech services firm Computer Sciences Corp. will pay $190 million fines related to its handling of a multi-billion-dollar contract with the U.K.’s National Health Service. The U.S. Securities & Exchange Commission had sued CSC and several of its former executives over the deal, charging that they manipulated financial results to hide “significant problems” with the contract.

Five of eight former CSC (CSC) executives charged cited also agreed to settle, according to an SEC statement. Former CEO Michael Laphen agreed to return $3.7 million in compensation to the company and pay a $750,000 penalty. Former CFO Michael Mancuso agreed to return $369,100 and pay a $175,000 penalty.

This statement is largely a formality, most of the details on the agreement were disclosed late last year.

In its own emailed statement, CSC said it was pleased to settle the matter which “focused largely on accounting issues from 2009 to 2012.” At that time the company brought in former IBM exec Michael Lawrie as CEO and adjusted its financial statements for the prior period. CSC neither admitted nor denied the allegations which basically were that CSC execs hid the impact of the delays by tweaking its accounting models.

Three other former finance execs—Robert Sutcliffe, Edward Parker, and Chris Edwards—are fighting charges filed in federal court in Manhattan.

CSC has been in the news much of late. A few weeks ago, it said it was breaking itself into two independent publicly traded entities, one for commercial customers and the other for federal accounts. It was also a possible acquisition target of Hewlett-Packard (HPQ), at least temporarily.

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About the Author
Barb Darrow
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