What's wrong with this picture? Hewlett Packard announces that its chief executive officer Mark Hurd resigns following allegations of sexual impropriety. The Wall Street Journal reports that he will walk off with a severance package of $12.2 million in cash plus more than 1,121,000 HP shares. At the shares' present value of $46.30, that creates a total payout of $64 million.
The New York Times provides details of Hurd's relationship with the marketing contractor at the heart of these allegations. Hurd was paying her for work she wasn't doing and the company found he had concocted false expense reports that covered payments made to the woman.
Doesn't that amount to fraud? Why has the company paid him out instead? If a lower level employee had been fiddling the books, they would have been charged but it's a different story for the CEO.
The company shares plunged 10% on the news of Hurd's removal so people lost money. He did a lot better than HP shareholders