Sanction against Sushovan Hussain in relation to Autonomy Corporation Plc
News types: Investigations
Published: 11 July 2024
This Press Notice concerns the outcome of an investigation into the relevant Member (as defined in the FRC’s Accountancy Scheme). It would not be fair to treat any part of this announcement as constituting or evidencing an investigation into, or findings in respect of the conduct of, any other persons or entities.
The Executive Counsel to the Financial Reporting Council (FRC) has agreed terms of settlement with Sushovan Hussain following admissions of Misconduct as a result of his conviction in the USA during April 2018 on 16 counts of fraud relating to his conduct at Autonomy Corporation plc (“US Criminal Conviction”).
Background
Mr Hussain was the Chief Financial Officer and a statutory director at Autonomy. The Executive Counsel delivered a Formal Complaint under the Accountancy Scheme alleging Misconduct against Mr Hussain dated 17 May 2018.
The Formal Complaint was subsequently stayed on 2 November 2018 pending the outcome of Mr Hussain’s appeal against the US Criminal Conviction. On the same day, Mr Hussain consented to a suspension from membership of the ICAEW pursuant to an Interim Order dated 2 November 2018.
Mr Hussain’s appeal against the US Criminal Conviction was not successful.
Misconduct
Pursuant to paragraph 16(1)(ii) of the Accountancy Scheme, the fact that a Member has been convicted of an offence before a Court outside the United Kingdom which would have constituted a criminal offence had the matter been prosecuted in the United Kingdom shall, for the purposes of the Scheme, be conclusive evidence of Misconduct of the Member.
Mr Hussain accepts that the US Criminal Conviction therefore amounts to Misconduct, and further accepts that such conduct is in breach of the Fundamental Principle of the ICAEW Code of Ethics to act with integrity.
In view of the significant overlap of subject matter between the allegations in the Formal Complaint and the findings made under the US Criminal Conviction, the Executive Counsel does not consider that it is in the public interest for a Disciplinary Tribunal to decide upon those allegations. The Executive Counsel therefore relies on the US Criminal Conviction alone to establish Misconduct.
Sanction
The sanction imposed on Mr Hussain is Exclusion from the ICAEW for a recommended period ending no earlier than 1 November 2038. Given Mr Hussain’s suspension as a Member of the ICAEW from 2 November 2018, the total period of Exclusion in respect of the Misconduct amounts to 20 years.
The long period of Exclusion reflects the seriousness of the Misconduct as evidenced by the fraud offences under the US Criminal Conviction. The Misconduct seriously undermines public confidence in the standards of conduct of Members and has brought discredit to the accountancy profession.
Following the US Criminal Conviction, Mr Hussain received a five-year custodial sentence and was ordered to pay financial penalties of approximately US$10 million. In light of this, the Executive Counsel does not consider it proportionate or necessary to impose any further sanctions, financial or otherwise, in this case.
Mr Hussain has paid £450,000 in respect of the Executive Counsel’s costs of the investigation.
The terms of settlement have been agreed by the Executive Counsel and approved by the Disciplinary Tribunal appointed to hear the Formal Complaint.
Read the Settlement Agreement, which appends the Amended Formal Complaint.