image credit:-Financial Times
Tech entrepreneur Mike Lynch is currently on trial in San Francisco, a pivotal moment in a legal saga that began 13 years ago. Lynch, once hailed as one of the UK’s most successful tech entrepreneurs, is facing allegations from US prosecutors of being involved in what they describe as “the largest fraud in the history” of Silicon Valley.
The accusations against Lynch stem from his time as the head of Autonomy, a software company he founded and later sold to Hewlett Packard (HP) for $11.7 billion (€10.7bn) in 2011. Prosecutors claim that Lynch falsified Autonomy’s accounts in the two years leading up to the acquisition.
Lynch’s trial, which began on Monday, involves 16 counts of wire and securities fraud, each carrying a maximum sentence of 20 years. He is being tried alongside Stephen Chamberlain, Autonomy’s former vice-president of finance.
The legal journey leading to this trial has been lengthy and complex. Lynch was extradited from the UK last year following a five-year legal battle. Pretrial hearings have seen some of the evidence that Lynch’s legal team had planned to present being barred by the judge, presenting a significant challenge for his defense.
The acquisition of Autonomy by HP was initially seen as a strategic move to bolster HP’s software division. However, just a year after the acquisition, HP’s then-chief executive, Meg Whitman, accused Autonomy’s former management of accounting irregularities, resulting in a $5 billion write-off.
Lynch has vehemently denied these allegations, asserting that he is being made a scapegoat for Whitman’s alleged mismanagement of Autonomy. This has placed Whitman, along with Frank Quattrone, a prominent investment banker, under scrutiny.
