I may have read Autonomy whistleblower emails about

One year before that unfortunate purchase

i may have read autonomy whistleblower emails about

Former Autonomy CEO Mike Lynch is battling a $ 5bn Supreme Court case brought by HPE over its $ 11bn reduction in Autonomy plc

Autonomy Trial ] A high-level finance department The Autonomy worker blew the whistle a year before HP bought it in 2011, and said the British software company was recognizing the revenue in agreements before the contracts were signed.

In an explosive July 2010 email to Autonomy USE, as the London High Court was shown, Percy Tejeda, the company's "revenue director", said he "began to have concerns" about certain duties. specific accountants that you were asked to perform.

Tejeda said that Autonomy was manipulating its risk estimates for ongoing contracts to inflate its quarterly financial estimates and also that it was falsifying purchase orders with suppliers as part of an income inflation scheme. He sent his concerns to the finance manager of Autonomy in the United States, Brent Hogenson, who was fired shortly after raising them, first with Lynch and then with the audit committee of Autonomy and the auditors of the Deloitte company.

One of Tejeda's concerns was a draft contract between Autonomy and pharma biz Eli Lilly, where he thought that some clauses "would affect the recognition of income from the transaction". In his email to Hogenson, he said:

Capax Discovery was an Autonomy distributor. Tejeda said that in June 2010, Chamberlain told him to create a "proforma invoice … that would not be subject to acceptance and that he would send that proforma invoice to Capax", with the intention that Capax would invoice Eli Lilly and then he will pay the Autonomy bills. for its fourth quarter 2009 license transaction.

Although the revenues had been recognized in the Autonomia accounts, the real payment was not made until months later, said Tejeda, saying: "I answered Steve that I did not feel comfortable doing that. "

Tejeda also alleged, among other things, that he was instructed to add $ 500k of revenue to an accounting spreadsheet under the heading" EDD Services "(EDD stands for Electronic Data Discovery, a search product self-employed for law firms.) When asked what relationship he had with him, he said that Associate General Counsel Jim Crumbacher told him, "I'm not sure, I would include him as one of the 'EDD Services' and I'll go ahead I'm not sure if anything has been recovered or not. "

HPE asserts, in its lawsuit against then-Autonomy CEO Mike Lynch and former Chief Financial Officer Sushovan Hussain, that some of the EDD payments hici They went to and from Capax Discovery were fake and were intended to generate real income. It states that each company would buy a similar value of goods and services from each other at the same time.

They told you, right, Mr. CEO?

Earlier this week, Mike Lynch, CEO of Autonomy in La hora, was questioned in the Superior Court by Tejeda's email. It was sent to him by Hogenson, who copied it again when he sent it to Deloitte and the internal audit committee of Autonomia. Hogenson had invoked "the Whistle Blower Policy I received from Andy Kanter" [Autonomy COO] and asked me for "guidance on how I should respond".

Responding to questions about Hogenson's emails, Lynch said: "No, your claim was that the auditors did not know that we had made EDD payments … and, in fact, the auditors knew about the EDD payments and Then they left and they did an investigation, they found nothing inappropriate. "

"Are you seriously saying you did not look at it?" Asked Laurence Rabinowitz QC, an HPE attorney.

"I may have looked at it," Lynch admitted Rabinowitz, rejecting Lynch's suggestion that he was simply "trying to be very precise here, "he continued:" He's not suggesting, is not he, that he did not read this particular email we're seeing now? "[19659004]" I may have read it, I do not know, "said Lynch. he insisted: "Assuming you read it, you would have seen … that you had been approving purchase orders with respect to a situation in which there was not even an underlying contract to that transaction, right?" [19659004] Lynch was he agreed and said: "Yes, I would have seen it if I had read this", suggesting that because Hogenson had copied it in Deloitte, it was a problem of the auditors and not of him.

In the email The answers shown to the Court, Sushovan Hussain, Direct r of Autonomy Finance, dismissed the concerns of Tejeda and Hogenson by saying "there is nothing new or material in these statements," and added that everything was fine because the internal auditors knew what was happening.

Yesterday at the court Rabinowitz told Lynch:

"I do not agree," the former CEO replied. Lynch said earlier that he did not know that Capax Discovery was unable, at that time, to deliver its customer service hired for EDD, blaming former US sales chief Christopher "Stouffer" Egan for signing agreements behind his back to eliminate revenue. . Lynch said he only discovered the subterfuge when Egan was charged, tried and convicted of fraud charges in the United States.

The British executive denied Rabinowitz's claim that he himself had lied when he said he had no reason to believe that there was any material problem with accounting. "

The Autonomy process continues. ®

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