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LATEST NEWS
Corporate
HP probe into info leak intensifies
Posted online: Saturday, September 09, 2006 at 0013 hours IST
Updated: Saturday, September 09, 2006 at 1202 hours IST
 
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SEPTEMBER 9:  The scandal over Hewlett-Packard Co’s secret probe to catch directors leaking information to the media deepened on Thursday, with the California attorney general threatening to bring criminal charges.

Investigators hired by chairwoman Patricia Dunn got board members’ phone records using fake identities, and Dunn used the information to weed out the source of leaks under the assumption the methods were legal, according to Palo Alto, California-based Hewlett-Packard.

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Bill Lockyer, the state’s highest-ranking law enforcement official, said he is working to determine who violated identity theft and computer-information theft laws. “It appears that a crime has been committed, we’re convinced of that,” Lockyer said in a telephone interview on Thursday. “It’s unclear exactly who is liable and how severe it is and who had specific knowledge.”

The board of Hewlett-Packard, the second-largest maker of personal computers, is reeling from disclosures that the investigation started by Dunn resulted in hired vendors obtaining the phone records of directors and nine journalists. AT&T Inc, the largest US phone company, helped the attorney general investigate alleged unauthorised access to call records and is suing 25 unknown individuals who set up phony accounts.

The debacle and possible criminal charges may lead to the resignation of Dunn, who is also vice chairwoman of Barclays Global Investors in San Francisco, or others, said James Post, professor at Boston University School of Management. “There was a moral line she crossed when she authorised the investigation,” Post said. “Do they believe she didn’t know about the illegal data collection?”

When asked about the possibility of Dunn resigning, company spokesman Ryan Donovan said Hewlett-Packard doesn’t comment on speculation. He said Dunn isn’t available for interviews.

The board leaks date back to at least January 2005, before the ouster of chief executive officer Carly Fiorina. Director George Keyworth, who admitted to divulging information, was asked to resign and declined.

The handling of the probe led venture capitalist Tom Perkins to quit the board in protest in May. Perkins, co-founder of Kleiner Perkins Caufield & Byers, was later assured by HP outside counsel Larry Sonsini in an e-mail that the investigation was “well done and within legal limits,” the Wall Street Journal reported on Friday.

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