7.2 C
New York
Monday, November 25, 2024

Mike Lynch to Testify in US Fraud Trial Over ‘Massive’ Fraud

British entrepreneur Mike Lynch is set to testify in his own criminal fraud trial on Thursday in a San Francisco federal courthouse. The trial, which began in March, sees Lynch facing 16 counts of wire fraud, securities fraud, and conspiracy related to the 2011 acquisition of his company by Hewlett-Packard (HP). If convicted, he could face up to 25 years in prison. Lynch has pleaded not guilty to all charges.

However, Lynch’s legal team hinted at the possibility of requesting a mistrial due to an allegedly improper line of questioning by the prosecution during cross-examination. The decision on whether to file this motion will be made by Thursday morning when the court reconvenes. If granted, a mistrial would result in Lynch potentially being retried at a later date.

Once dubbed “Britain’s Bill Gates,” Lynch sold his software firm, Autonomy, to HP in a deal that prosecutors claim was based on “a series of lies.” He is accused of artificially inflating Autonomy’s sales figures, misleading auditors, analysts, and regulators, and intimidating those who voiced concerns.

HP acquired Autonomy for $11.1 billion (ยฃ8.72 billion), a deal from which Lynch personally received ยฃ500 million. However, just a year later, HP announced “serious accounting improprieties, disclosure failures, and outright misrepresentations,” resulting in an $8.8 billion write-down of the acquisition’s value.

In his testimony on Thursday, Lynch is anticipated to continue the line of defense put forward thus far by his legal team, which attributes some financial discrepancies at the heart of the alleged fraud to differences between US and UK accounting standards and suggest he was not the driving force behind the decisions in question.

Also Read: UK Election Date Drives Positive Market Recovery Sentiment

Reid Weingarten, Lynchโ€™s attorney, has argued that the case amounts to a โ€œroutine business disputeโ€ which spiraled into an โ€œoverblown fraud caseโ€. While the prosecutorsโ€™ argument is โ€œblack and whiteโ€, Weingarten told the court, the reality is more nuanced.

โ€œYouโ€™re going to see in this trial [that] that ainโ€™t the way the world works,โ€ he said. โ€œThe world works in grey. The world is complicated.โ€

Prosecutors, meanwhile, have painted Lynch as a domineering boss, and a driving force behind a โ€œmassiveโ€ years-long fraud.

โ€œAutonomyโ€™s financial statements were materially false and misleading,โ€ assistant US attorney Adam Reeves said, claiming the company lied to auditors and investors โ€œagain and againโ€ over 10 quarters, and fraudulently inflated its revenue between 2009 and 2011 to suggest growth.

Lynch was indicted by a federal grand jury in 2019 and extradited from the UK to the United States last May. After posting a $100m bond, he was released to house arrest at a property in San Francisco where he has spent the last year preparing for the trial.

Lillian Hocker
Lillian Hocker
Lillian Hocker is a seasoned technology journalist and analyst, specializing in the intersection of innovation, entrepreneurship, and digital culture. With over a decade of experience, Lillian has contributed insightful articles to leading tech publications. Her work dives deep into emerging technologies, startup ecosystems, and the impact of digital transformation on industries worldwide. Prior to her career in journalism, she worked as a software engineer at a Silicon Valley startup, giving her firsthand experience of the tech industry's rapid evolution.

Latest Posts

Don't Miss

Stay in touch

To be updated with all the latest news, offers and special announcements.