WSJ: Ex-CA Sales Chief Richards Resentenced To Time Served

The former sales chief for CA Inc. was resentenced to time served Thursday after he had pleaded guilty four years ago in a scheme to artificially boost the software maker's quarterly revenue through backdated sales contracts.

Stephen Richards, 45, had served 44 months in prison after pleading guilty to conspiracy, securities fraud and other charges in April 2006. He is at Taft Correctional Institution in Taft, Calif.

"We are absolutely ecstatic that the judge reduced Stephen Richards's sentence and he will be reunited with his family," said David Zornow of Skadden, Arps, Slate, Meagher & Flom LLP, which represented Mr. Richards.

Mr. Richards started at CA, formerly known as Computer Associates, at age 23 and worked for the company in Australia and in New Zealand prior to 1999. He was originally sentenced to seven years in prison in November 2006. In August, a federal appeals court ordered that he be resentenced because the district judge failed to give him credit for accepting responsibility for his actions. On Thursday, U.S. Judge I. Leo Glasser in Brooklyn resentenced him.

Mr. Richards, a New Zealand citizen, is expected to be deported when released, a process that could take as long as 12 weeks, Mr. Zornow said. Mr. Richards plans to relocate to Australia to be with his family after his release, Mr. Zornow said.

Prosecutors had alleged that former CA Inc. Chief Executive Sanjay Kumar and other executives engaged in a scheme to artificially boost the company's quarterly results by backdating software contracts to make it appear that the license agreements had been signed during the quarter.

The practice was referred to internally as the "35-day month" because it involved artificially extending reporting months, usually the last month of a fiscal quarter, prosecutors said.

Mr. Kumar was sentenced to 12 years in prison after he had pleaded guilty to securities fraud, obstruction of justice and other charges in 2006. The U.S. Second Circuit Court of Appeals upheld his sentence in August.

The Islandia, N.Y., company agreed to pay $225 million in restitution to shareholders as part of a deferred-prosecution agreement reached with prosecutors in September 2004. Criminal charges were dismissed against the company in 2007.

-By Chad Bray, The Wall Street Journal; 212-227-2017; chad.bray@wsj.com

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