Criminal fraud trial of UK tech tycoon Mike Lynch to begin
The criminal fraud trial of the British technology tycoon once lauded as “Britain’s Bill Gates” is due to begin in San Francisco on Monday.
Mike Lynch, co-founder of the UK software company Autonomy, stands accused of artificially inflating the software firm’s sales; misleading auditors, analysts and regulators; and intimidating people who raised concerns before its blockbuster takeover by Hewlett-Packard in 2011.
He has pleaded not guilty, having always denied the allegations of wrongdoing. If convicted, he faces up to 25 years in jail.
HP bought Autonomy in an $11.1bn (£8.72bn) deal designed to turbocharge its software business. Barely a year later, however, it wrote down the value of the acquisition by $8.8bn, and alleged “serious accounting improprieties, disclosure failures and outright misrepresentations” at the business.
In 2019 Lynch was indicted by a federal grand jury. He has been charged with 17 counts of wire fraud, securities fraud and conspiracy.
Lynch was previously lauded for his achievements. He was awarded an OBE (Order of the British Empire) for services to enterprise in 2006, and appointed in 2011 to the science and technology council of then prime minister David Cameron. He also served on the board of the BBC, and established an investment firm that backed Darktrace, the cybersecurity firm.
For years Lynch has argued that Autonomy’s underperformance at HP was the result of mismanagement by its new owner, rather than fraud before the takeover. He has spent much of the past year preparing for trial under house arrest.
Lynch was extradited from the UK to the United States last May. After posting a $100m bond, he has been required to wear a GPS ankle tag and remain under the watch of armed guards around the clock.
Only in November was he permitted to leave the lavish San Francisco property he has been using a base between 9am and 9pm each day, albeit under strict conditions.