Serious Fraud Office Drop Investigation Into Autonomy Accounting 53
mrspoonsi sends up an update on the investigation into Autonomy, a software company acquired by HP in 2011. HP paid a staggering $11.7 billion in the deal, then later wrote off $8.8 billion and claimed Autonomy's management intentionally defrauded them. The UK Serious Fraud Office opened a case on the matter in 2013, but that investigation has now been dropped. According to the Office's press release, they felt there was "insufficient evidence for a realistic prospect of conviction," given the information they had to work with. Autonomy is not off the hook, however — the case has now been entirely ceded to U.S. authorities.
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Re:confusing headline. (Score:5, Funny)
Yes, the originators of the language have clearly got it wrong.
Re:confusing headline. (Score:5, Interesting)
Yes, the originators of the language have clearly got it wrong.
The funny collective-noun-plural-verb thing is an innovation by the Brits. In England, the language continued to develop during the 1800s and even 1900s, while it remained more or less fixed in the US (partly under the influence of Noah Webster) subsequent to independence. Thus Shakespeare writes "The army is discharged all and gone" in Henry IV, not "The army are discharged all and gone."
Re:confusing headline. (Score:4, Informative)
I think you might be inebriated: it's malted barley and hops. In fact, I'm pretty sure you can't malt hops.
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Here you go, a complete list: https://www.gov.uk/government/... [www.gov.uk] . Much less interesting than I hoped.
I think the prize for best name goes to the Scientific Advisory Committee on the Medical Implications of Less-Lethal Weapons [www.gov.uk]
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And two little letters "UK" at the start of the headline would have eliminated all ambiguity. The headline is an example of prima facie editorial failure.
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Whereas entertainers are investigated by The Humourous Fraud Office
Just a thought... (Score:4, Insightful)
So, in their quest to be like Facebook and Google by snapping up technology for obscene money, they forgot to do "due diligence", and now they are pissed?
HP used to be such a great technology company, until they switched to the printer ink scam... At least they sold off their bench test equipment designs to a company that is still producing fairly nice stuff.
Re:Just a thought... (Score:4, Insightful)
At $10 BILLION I don't think there is any "forgot" here.
Even at the time of the deal the price was questionable. It was 10x more than Autonomy was possibly worth.
I would say "follow the money" but it is sounding like someone did not complete their part of the deal.
Yeah. This sounds more like an attempt to loot the company that didn't pan out.
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Having used some of Autonomy's products I'd say that HP paid $11.7 B too much for the company.
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I had to use one of their search tools (well, one from a company that they bought actually) when I was looking after the applications for a website. The only time I used the site search was when I had to try to diagnose a problem with it. For the most part those of us on the application support team used Google when we needed to find anything on our site because it provided better results.
I was sent for training on the product and the person giving the lessons used a major electronics company as an exampl
When does the investigation into HP start? (Score:4, Insightful)
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You expect actual justice? In THIS modern world?!
I believe the expectations may have been a bit less lofty than that. The internet doesn't do sarcasm very well, but I believe there may have been a bit of rolling of the eyes with that rhetorical question.
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Re:When does the investigation into HP start? (Score:4, Insightful)
I doubt it.
These shareholders are the exact same people who fired Walter Hewlett for opposing the Compaq merger.
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You have a surprising amount of faith in investor's ability to tell stupid shit from a "high-risk/high-reward acquisition strategy." Particularly when "high-risk/high-reward" is followed by sophisticated business-speak for "it's all that guy's fault," especially in this case, which includes a large subtext of "and it'll be at least three more years before the police decide to call my bluff on this particular line of ridiculous BS."
By the time all the cops have confirmed that it's BS all the relevant people
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unless the criminal is richer (Score:1)
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You might be able to actually see an investigation here. HP is beholden to their shareholders, and shareholders don't like to lose money. Under US law they can actually sue the management of HP in this case.
The key point to take away here is that justice doesn't exist in the US UNLESS you have screwed over someone who is richer than you.
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Not excusing HP but if someone is looking to intentionally defraud in this scenario and they have control of the information, books, invoices etc that are handed to HP then it is nearly impossible to ever be 100% certain before an acquisition, at some point you have to trust that the people you are dealing with and if you are then found to have been duped you get the police involved.
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Not excusing HP but if someone is looking to intentionally defraud in this scenario and they have control of the information, books, invoices etc that are handed to HP then it is nearly impossible to ever be 100% certain before an acquisition, at some point you have to trust that the people you are dealing with and if you are then found to have been duped you get the police involved.
With a deal this big, HP might have wanted to verify the numbers through independent sources?
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As I said, not trying to defend HP, they clearly screwed up in a monumental fashion. The fact remains though if people want to commit fraud in this scenario even with auditors and accountants checking the books you can pull the wool over peoples eyes. I worked many years with an auditor and we hired him specifically for the reasons he could tell us exactly what auditors are looking for, we did it to make audits go quicker and faster by being more compliant, but you could just as easily use that information
This is serious... (Score:4, Insightful)
Autonomy is not off the hook, however â" the case has now been entirely ceded to U.S. authorities.
Handed over to the U.S. Petty Fraud Department, where a slap on the wrist and a generous tax break for HP will be quickly administrated. Move along. Nothing to see here.
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Handed over to the U.S. Petty Fraud Department, where a slap on the wrist and a generous tax break for HP will be quickly administrated.
HP is a private company. It's the shareholders who have been punished, by eating an 8 billion dollar loss, and that's as it should be. When the US taxpayer is forced to bail out what's left of HP then there would be something to talk about, but until that time it's just another case of the foolish being separated from their money. This isn't grade school, it's the real world. When you play marbles for keeps, nobody sheds a tear when you lose your lunch money.
HP Paid silly money (Score:5, Informative)
HP paid silly money, all the details of Autonomy's accounting numbers were right there in the books, anyone who read the books said "you're stupid to pay that much", Oracle said as much publicly after they turned it down, saying it was way overpriced.
http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/electronics/8796470/Oracle-and-Autonomy-row-escalates-as-Larry-Ellison-accuses-Mike-Lynch-of-lying.html
"Mr Ellison claimed in an earnings call last week that Autonomy had been "shopped" to Oracle before the British software company agreed its controversial $11.7bn (£7.1bn) sale to Hewlett Packard"
""After listening to Mr Lynch’s PowerPoint slide sales pitch to sell Autonomy to Oracle, Mr Kehring and Mr Hurd told Mr Lynch that with a current market value of $6 billion, Autonomy was already extremely over-priced."
The price HP paid NEARLY DOUBLE, the price that Oracle refused to pay as overpriced.
The valuation was insane, based on FUTURE growth not present value, and growth is illusive, based on OPINION not fact, because nobody can see into the future. So you believed managements OPINION as to future growth and didn't estimate your own numbers, HP.
Now they try to get a prosecution because management willfully misled you? They painted too rosy a future? F*off. You're just incompetent. Oracle correct said it was overpriced, and you didn't, and paid nearly double the price Oracle said was too much.
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They painted too rosy a future? F*off. You're just incompetent.
That's damn right. What do they think this is, nursery school? HP lost money because management was stupid and the shareholders lost money because they put their faith in half wits. They both deserved to lose that money, it's how the economy reallocates resources to smarter people who will put them to more effective use. To quote Nelson Muntz, "Ha Ha"!
Hardly ever happens with tech buyouts (Score:3)
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Management estimates, not opinions. Management estimates have a risk attached to them, and it can be a really solid risk: you can have a 1% chance of hitting it big, or a 95% chance of taking market dominance; and you can predict this quite easily, if you know what you're doing.
In this case, HP and Oracle assert that they were looking at made-up bullshit, not management estimates: Autonomy was throwing out this ideal situation that had near-0% likelihood of occurring, and claiming it as the high-proba
Just another in a long series of misguided mergers (Score:5, Insightful)
HP has a very long history of buying companies only to unload them for cents on the dollar a few years later. Remember Palm and WebOS? Take a look at the HP Acquisition List [wikipedia.org] on Wikipedia. Not many of those companies were good buys.
This was another of many issues that contributed to staff depression while I was there and continues to this day. We could see it was wrong, but could do nothing about it.
They used to be the company engineers wanted to work for. When I got to Pixar in '81, the engineers that had been at HP were still proud of having worked there. It's really sad what's happened.
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Which photo?
I have not been at HP for a long time, of course.
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They used to be the company engineers wanted to work for. When I got to Pixar in '81, the engineers that had been at HP were still proud of having worked there. It's really sad what's happened.
They are now the company IT managers want to work for.
Today's HP internal management culture is one where technical staff is being sneered at and technical ignorance is a badge of honor.
The company has lost it's way some time around the Compaq merger and is now slowly rotting from the inside.