Former Tyco Executives Kozlowski, Swartz Plead Not Guilty of Defrauding Company
Former Tyco Int’l Ltd. executives L. Dennis Kozlowski and Mark Swartz on Sept. 16 pleaded not guilty to charges unveiled earlier in the day that they were behind an elaborate scheme to defraud the company and investors of approximately $600 million, According to Reuters.
Also, Tyco’s former general counsel, Mark Belnick, pleaded not guilty to charges of falsified documents to hide $14 million in loans to himself from the Bermuda-based company.
On the same day, Tyco sued Kozlowski and Swartz, accusing Kozlowski of fraud and self-dealing, which includes abusing Tyco’s relocation and key employee loan programs while obtaining under false pretenses loans that he used to fund personal expenditures. The lawsuit took place at the same time Manhattan prosecutors and U.S. regulators stepped in with their own charges against him and two other former senior executives.
Kozlowski, facing a 14-count indictment for evading sales taxes on millions of dollars in art purchases, was released on a $100 million personal-recognizance bond, of which he must secure 10 percent, or $10 million, with his personal assets, within a week.
Swartz, Tyco’s former CFO, was released on $50 million bail, and must secure with $5 million of his personal assets within a week. Belnick, meanwhile, was released on $1 million bail.
The three men, who were taken into the Manhattan courtroom in handcuffs, must return to court on Sept. 19.
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