Sanjay Kumar Sentenced to 12 Years in Prison

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Former CA Inc. Chief Executive Sanjay Kumar was sentenced to 12 years in prison Thursday after pleading guilty earlier this year to a scheme to artificially boost the software maker’s quarterly revenue through backdated sales contracts.

At a hearing in federal court in Brooklyn, U.S. District Judge I. Leo Glasser sentenced Kumar to 144 months in prison, to be followed by three years supervised release. The judge also ordered Kumar, 44 years old, to pay a fine of $8 million, but deferred payment until after restitution is determined. A hearing is set on restitution for February 2.

“I stand before your honor today to take full responsibility for my actions,” Mr. Kumar said prior to sentencing. “I know that I was wrong and there’s no excuse for my conduct.”

Mr. Kumar is scheduled to report to prison on February 27.

In April, Mr. Kumar pleaded guilty to securities fraud, obstruction of justice, conspiracy, making false filings to the Securities and Exchange Commission, and making false statements. Mr. Kumar left the company — formerly known as Computer Associates — in April 2004.

Several former executives, including CA’s ex-sales chief Stephen Richards, have pleaded guilty to criminal charges in the matter. Mr. Richards is expected to be sentenced November 14.

The Islandia, N.Y., company itself avoided indictment by reaching a deferred prosecution agreement with the government in 2004 in which it agreed to pay $225 million in shareholder restitution.

Prosecutors have alleged Mr. Kumar and others 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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