Tyco's Kozlowski took hard line against embezzling crimes
By The Associated Press
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In the same year he allegedly began stealing up to $600 million from Tyco
International, former Chief Executive Dennis Kozlowski urged a judge to
throw the book at an employee who had embezzled a fraction of that amount
from a subsidiary.
"I view Mr. Shah's crime as particularly egregious," Kozlowski wrote to
court officials in the 1995 case of Girish Shah, The Boston Globe reported
yesterday. "Not only did he steal from the stockholders of this Fortune 500
company, but he breached the fiduciary duty placed in him by the company
and his supervisor(s)."
Shah, an assistant controller at Tyco's Grinnell fire-protection division,
had been charged in Houston with stealing $988,000 from the company over
eight years. According to transcripts, Shah pleaded no contest in state
court to overcharging customers and siphoning money from funds that went
unclaimed by subcontractors.
Though Shah was ready to repay $728,000 immediately and borrow money from
relatives to repay most of the rest, Kozlowski urged a sentence of 30 years
in prison.
"I urge you to impress upon Mr. Shah and those others who commit similar
crimes that wrongdoing of this nature against society is considered a grave
matter by the Texas Court and will not be condoned," Kozlowski wrote seven
years ago.
Shah, then 41, was sentenced to 20 years in prison and served 3-1/2 before
being paroled in 1999.
Kozlowski and Tyco's then-chief financial officer, Mark Swartz, were
charged in September with stealing $170 million from the company, partly by
abusing bonus and loan programs and reaping an additional $430 million
through improper securities sales in a series of self-dealings that
stretched back to 1995.
They have pleaded not guilty to enterprise corruption and grand larceny,
each punishable by up to 25 years in prison.
Shah, who lives in Sugar Land, Texas, said he never saw Kozlowski's letter.
Shah said he began embezzling after seeing his superiors take advantage of
unfair bonus plans and was not surprised to hear of the indictments against
his former bosses.
A report released Monday after a six-month internal investigation found
"aggressive accounting" methods in use since 1999 to puff up Tyco's
profits. It also concluded that the organization lacked a commitment to
proper "ethics, integrity, accounting and corporate governance."
Kozlowski's lawyer, Stephen Kaufman, did not return phone calls Tuesday
yesterday.
Three years after his release, Shah said he has held a few temporary jobs
and done accounting work for his own clients.
http://seattletimes.nwsource.com/html/businesstechnology/134606489_tycofaces01.html
Worst Dec market since 31,things are looking up.
