Tyco International Ltd. filed a $400 million lawsuit against its former finance
chief, alleging the executive received hundreds of millions of dollars in improper
payments, the Boston Globe reports.For a Limited Time receive a
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Get Your Report Now!The company says it filed the civil lawsuit in Manhattan after it failed to
negotiate a settlement through arbitration with Mark Swartz, who was the company's
chief financial officer from 1995 through August 2002.
"… Swartz improperly took Tyco funds and assets personally and aided,
abetted and facilitated the misappropriation of Tyco funds and assets by others,''
the lawsuit alleges.
An attorney for Swartz tells the newspaper the lawsuit is a "publicity
stunt," adding that his client wished to put off the arbitration until the completion
of his criminal trial, which is scheduled to begin in September. In an indictment
for the criminal trial, prosecutors alleged Swartz and former chief executive
L. Dennis Kozlowski engineered a scheme in which they took $600 million in unauthorized
payments, according to the newspaper. Both pleaded not guilty to the charges.
''As we have previously communicated to Tyco, we believe the appropriate time
for such an arbitration is following the conclusion of the criminal case,''
says Charles Stillman. ''There is no fair reason for Tyco to commence this court
action now.''
The Tyco lawsuit claims that Swartz abused executive loan and relocation programs
for his personal benefit, and in the process misled the company's compensation
committee, the Globe reports. According to the complaint, the executive manipulated the company to pay for perks
that included homes and apartments, tuition for his children's private schools, tickets
to sporting events, a helicopter ride for his wife, and travel on the company's
airplane, the newspaper reports.
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