Mike Lynch: There was no missing cash – or luxury villas in Bahamas
TECHNOLOGY tycoon Mike Lynch has said efforts to extradite him to the US are an ‘affront to the sovereignty of British courts’ – and appeared to brush off the furore over alleged fraud, claiming that no money went missing.
Lynch is on the brink of being handed to the American authorities to face criminal fraud charges relating to the controversial sale of his software firm Autonomy to Hewlett-Packard.
It follows a damning High Court judgment last year when he and his finance director were found to have duped the US company into overpaying for Autonomy, which Hewlett-Packard bought for $11billion (£9billion) in 2011. Lynch was found to have defrauded HewlettPackard by manipulating Autonomy’s accounts to inflate the value of the company. He has always denied the accusation.
Damages are still to be awarded to Hewlett-Packard, though a judge has said they will be ‘substantially less’ than the $5billion it sought.
Now, in a recent letter to his supporters seen by The Mail on Sunday, Lynch claims the row over Autonomy was ‘an argument over accounting treatment and valuation metrics’, adding: ‘Crucially, there was never any cash missing from Autonomy. Every penny is there.’
And, in an apparent reference to Sam Bankman-Fried, the founder of collapsed crypto-currency exchange FTX, who was recently extradited from the Bahamas to face fraud charges in the US, Lynch added: ‘No one was using company funds to buy luxury villas in the Bahamas or support a failed hedge fund on the side, which, from my armchair vantage point, seems to be what happens when it really goes wrong in situations like FTX.’
Thanking his supporters, Lynch vowed to carry on fighting, but conceded there was ‘no change to the extradition system that can affect my case’, adding: ‘But that doesn’t mean it shouldn’t be changed.’
And he warned: ‘What is happening to me today could happen to anyone tomorrow. Other British business people may find they are sued by US companies who can also turn the loaded gun of a criminal indictment on them in what is fundamentally a commercial dispute, putting them at the mercy of this extradition treaty.
‘This is surely an affront to the sovereignty of British courts and the British justice system. Is it not time, to borrow a phrase, that we “took back control”? ’
Lynch said it was ‘very likely’ that his appeal against the extradition would be heard in the High Court in the next few months.
‘Bizarrely, the extradition court may well be asked to come to a decision before the civil court has determined what harm, if any, Hewlett-Packard incurred as a result of the Autonomy transaction,’ he said. He added that ‘there
was no $5 billion fraud at Autonomy as Hewlett-Packard originally claimed’ and said: ‘The so-called loss to Hewlett-Packard may well turn out to be nothing. Even Hewlett-Packard’s own auditors
‘Extradition threats are an affront to UK sovereignty’
‘Loss at Hewlett-Packard may turn out as nothing’
concur that the matters in their complaint had no material impact on valuation.’
Autonomy’s former finance director, Sushovan Hussain, has already been jailed for five years in the US after being found guilty of fraud relating to the deal.