UK's anti-fraud agency says may be conflicted in Autonomy probe
Britain's fraud-busting agency said it might have a conflict of interest in its investigation of Autonomy, a British software company accused of accounting irregularities by its new U.S. owners Hewlett-Packard Co.india Updated: Mar 12, 2013 18:02 IST
Britain's fraud-busting agency said it might have a conflict of interest in its investigation of Autonomy, a British software company accused of accounting irregularities by its new U.S. owners Hewlett-Packard Co.
The Serious Fraud Office (SFO) said on Tuesday it might be using an Autonomy product, Introspect, as a document management tool as it formally confirmed that it had opened a criminal investigation into how the British company was sold.
The agency said it was now making inquires to establish whether it could continue its probe into allegations that the U.S. PC and printer maker was duped when it bought Autonomy for $11.1 billion in 2011.
"The SFO is keen to ensure that there is now no conflict of interest or perception of such a conflict, and it is obliged as a first step to make inquiries to ensure that it can continue as the investigating body," it said in a statement.
The cash-strapped SFO has been dubbed the "Seriously Flawed Office" since some of its high-profile cases collapsed, or victories were only partial. Last year's botched probe into property moguls Vincent and Robert Tchenguiz left it fighting a 300 million pound ($447 million) damages claim.
HP said in regulatory documents filed on Monday that the SFO had joined the U.S. Department of Justice and the UK accounting regulator, the Financial Reporting Council, in opening a probe into Autonomy.
HP, which bought Autonomy in a bid to make it the centerpiece of a shift into software, stunned the market a little over a year after the purchase by writing off three quarters of the British firm's value.
It alleged "some former members of Autonomy's management team used accounting improprieties, misrepresentations and disclosure failures" to inflate the company's apparent worth.
Autonomy has denied the allegations.
Autonomy's former chief executive Mike Lynch, an Irish-born mathematics whiz who led the firm when it was sold, has blamed the fall in its valuation on HP's mismanagement. He has hired one of London's top law firms, Clifford Chance, to contest the allegations.