You could be excused these days if it seems to take something of a scorecard to determine just how many NHL owners might be in trouble with the law. Now it's time for New York Islanders owner Charles Wang to reluctantly step into the spotlight.Though many have forgotten, Wang didn't buy the Islanders by himself in 2000. Rather, he did it with Sanjay Kumar, the protege that succeeded him as CEO of Computer Associates (CA) that same year. But the happy times didn't last.
In 2004, Kumar was forced to resign due to an accounting scandal, and just two years later agreed to plead guilty to a variety of charges including securities fraud and obstruction of justice. He was sentenced to 12 years in prison, and agreed to pay more than $225 million in restitution, selling his share in the Islanders and the AFL's New York Dragons to Wang.
At the heart of the charges was a very simple thing to understand: The government accused Kumar of booking revenue after the close of a quarter and backdating it in order to make sure the company hit its earnings projection and kept Wall Street happy. But now Newsday is reporting that Kumar, only two years into his sentence, is saying that Wang and a number of CA's board members, including former U.S. Senator Alfonse D'Amato (R-N.Y.), knew about the shoddy and deceptive accounting practices at the company as far back as 1987 -- 13 years before Kumar became CEO and the same year Kumar joined the company when CA bought out his then employer, UCCEL . An affadavit containing Kumar's charges has been submitted as evidence in a shareholder suit against CA being spearheaded by CA shareholder and Texas billionaire Sam Wyly.
But will the charges stick? One white collar attorney that Newsday interviewed says no, and that in the absence of any new evidence corroborating the charges, it's unlikely that Wang would be prosecuted. Then, there's always the statement that Kumar gave to the judge when he was sentenced back in 2006: "I stand before your honor today to take full responsibility for my actions. I know that I was wrong and there's no excuse for my conduct."
