Dennis Kozlowski, CEO of Tyco International, was convicted of grand larceny. He and Tyco chief financial officer Mark H. Swartz were accused of taking more than $150 million from the company through unauthorized bonuses, loans, and other benefits.
Kozlowski’s lavish spending became a symbol of the scandal. Prosecutors focused on $81 million in unauthorized compensation, a $14.725 million art purchase, and Tyco’s $20 million payment to investment banker Frank Walsh. The first trial ended in a mistrial in 2004 after a juror-related incident attracted intense publicity.
At a 2005 retrial, Kozlowski and Swartz were convicted on 22 counts, including grand larceny, falsifying business records, securities fraud, and conspiracy. Kozlowski received a sentence of 8 years and 4 months to 25 years and was ordered to pay restitution and fines. The case is often confused with Enron, whose collapse involved Arthur Andersen; Tyco’s scandal centered on executive self-dealing and corporate governance failures.