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The government awards contracts to companies with histories of misconduct such as contract fraud and environmental, ethics, and labor violations. In the absence of a centralized federal database listing instances of misconduct, the Project On Government Oversight (POGO) is providing such data. We believe that it will lead to improved contracting decisions and public access to information about how the government spends hundreds of billions of taxpayer money each year on goods and services. Report an instance of misconduct »

Electronic Data Systems

Accounting Irregularities

Date: 09/25/2007 (Date of Settlement)

Misconduct Type: Securities

Enforcement Agency: SEC

Contracting Party: None

Court Type: Administrative

Amount: $490,902

Disposition: Settlement

Synopsis: Electronic Data Systems agreed to pay $490,902 in disgorgement and prejudgment interest to settle a Securities and Exchange Commission investigation into alleged accounting irregularities that occurred from 2001 to 2003. According to the SEC, EDS failed to disclose, or selectively disclosed, the cost of certain derivatives contracts, failed to adequately disclose an extraordinary transaction with a major customer that increased its reported cash flow by $200 million, and maintained inaccurate books and records. The latter charge partly involved the conduct of the Indian office of former EDS subsidiary A.T. Kearney, Inc., whose president was alleged to have paid bribes to senior employees of Indian state-owned companies between 2001 and 2003 to retain their business. EDS neither admitted nor denied wrongdoing. See related Electronic Data Systems misconduct instance, “SEC v. Srinivasan (A.T. Kearney India Bribes).”