HP to pay 14.5 million for illegal spying on its own directors and also journalists. NY Times.
Hewlett to Pay $14.5 Million in Deal on Spying Case
By DAMON DARLIN
SAN FRANCISCO, Dec. 7 — Hewlett-Packard said today that it would pay $14.5 million in a settlement with the California attorney general over the company’s use of private detectives to obtain phone records of board members and journalists.
The company is paying $650,000 in fines for “statutory damages,” but the bulk of the money, $13.5 million, is going to create a state-administered fund to finance the investigation of privacy violations. The rest of the settlement goes to cover the attorney general’s expenses in its investigation of the corporate spying case.
Hewlett-Packard reported revenue for its fiscal year of $91.7 billion. The fine is equivalent to what the company brings in every 83 minutes.
The attorney general’s civil lawsuit was filed today in state court along with the settlement of that case. The civil suit did not name any individuals.
The attorney general, Bill Lockyer, filed criminal charges in early October against five people, including Patricia C. Dunn, the former H.P. chairwoman, and a former company lawyer, accusing them of violating state privacy laws. All of the individuals have pleaded not guilty.
In those cases, the attorney general alleges that company officials passed on information to private investigators — who in turn passed it to other private investigators — that allowed the personal phone records of several board members and journalists to be viewed. The investigators used a form of subterfuge, called pretexting, to obtain the private phone records by pretending to be someone else.
The settlement of the civil suit puts an end to the company’s problems with state investigators. But on the federal level, the Justice Department, the Securities and Exchange Commission and the Federal Communications Commission are all investigating the company’s conduct during the company’s internal investigations of leaks from its board during 2005 and 2006.
By DAMON DARLIN
SAN FRANCISCO, Dec. 7 — Hewlett-Packard said today that it would pay $14.5 million in a settlement with the California attorney general over the company’s use of private detectives to obtain phone records of board members and journalists.
The company is paying $650,000 in fines for “statutory damages,” but the bulk of the money, $13.5 million, is going to create a state-administered fund to finance the investigation of privacy violations. The rest of the settlement goes to cover the attorney general’s expenses in its investigation of the corporate spying case.
Hewlett-Packard reported revenue for its fiscal year of $91.7 billion. The fine is equivalent to what the company brings in every 83 minutes.
The attorney general’s civil lawsuit was filed today in state court along with the settlement of that case. The civil suit did not name any individuals.
The attorney general, Bill Lockyer, filed criminal charges in early October against five people, including Patricia C. Dunn, the former H.P. chairwoman, and a former company lawyer, accusing them of violating state privacy laws. All of the individuals have pleaded not guilty.
In those cases, the attorney general alleges that company officials passed on information to private investigators — who in turn passed it to other private investigators — that allowed the personal phone records of several board members and journalists to be viewed. The investigators used a form of subterfuge, called pretexting, to obtain the private phone records by pretending to be someone else.
The settlement of the civil suit puts an end to the company’s problems with state investigators. But on the federal level, the Justice Department, the Securities and Exchange Commission and the Federal Communications Commission are all investigating the company’s conduct during the company’s internal investigations of leaks from its board during 2005 and 2006.
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