Ex-Tyco execs may get up to 25 years
NEW YORK — L. Dennis Kozlowski, the former CEO of Tyco International Ltd., and former Tyco finance chief Mark Swartz were sentenced Monday to up to 25 years in prison for stealing hundreds of millions of dollars from the company in a case that outraged the public with its tales of executive greed and excess.
The men, who were immediately ordered into custody, will be eligible for parole after serving eight years and four months.
Family members wept in the gallery as the sentences were imposed. Kozlowski was led out of the front of the courtroom in handcuffs as his wife quietly sobbed from a bench three rows back.
State Supreme Court Justice Michael Obus ordered Kozlowski and Swartz to pay a total of $134 million in restitution; in addition, Kozlowski was fined $70 million, Swartz $35 million.
The sentences capped a case that exposed the executives’ extravagant lifestyle after they pilfered some $600 million from the company including a $2 million toga birthday party for Kozlowski’s wife on a Mediterranean island and an $18 million Manhattan apartment with a $6,000 shower curtain.
Kozlowski, 58, and Swartz, 44, were convicted in June after a four-month trial on 22 counts of grand larceny, falsifying business records, securities fraud and conspiracy. It was their second trial — the first ended in mistrial after a juror said she received threats following reports that she made an “OK” signal to the defense team.
Kozlowski and Swartz are the latest executives sentenced to prison in a wave of white-collar scandals that shook corporate America and outraged investors, employees and retirees after thousands of people lost their jobs and pension nest-eggs.
One-time WorldCom Chairman Bernard Ebbers was sentenced to 25 years in prison for the $11 billion accounting fraud that toppled the telecommunications company that emerged from bankruptcy as MCI Inc. Adelphia Communications Corp. founder John Rigas was sentenced to 15 years in prison for his role in the looting and fraud at the cable TV company. His son and former finance chief, Timothy Rigas, got 20 years.
Enron Corp. founder Kenneth Lay, former CEO Jeffrey Skilling and former top Enron accountant Richard Causey are expected to go to trial in January.
At Monday’s sentencing hearing, Assistant District Attorney Owen Heimer asked the judge to impose the maximum 15 to 30 years, saying Kozlowski “should not be shown any leniency.”
“He stole. He committed fraud. He committed perjury,” Heimer said. “He engaged in a shocking spree of self-indulgence.”
But Kozlowski asked the judge to be as “lenient as possible” and to consider “all the positive things I have done in my life.”
Kozlowski’s lawyer said he would ask an appeals court to grant bail pending his appeal.
Swartz also asked for leniency, and his lawyer, Charles A. Stillman, said he was a man of “remarkable decency.”