FAQ: The HP boardroom leak scandal

FAQ: The HP boardroom leak scandal

Who's involved, what happened and what it means.

I've been avoiding this thing. You've got one sentence. Fill me in.

Officials at Hewlett-Packard launched an investigation to track some leaks coming from the board of directors, and some of the methods used were ethically questionable, if not positively illegal; a lot of agencies are investigating, and HP investors are getting a bit jittery.

What was being leaked? Who and why?

The source of the leak was board member George Keyworth, who was speaking to various tech-industry publications, providing at least one with information on the goings-on at a closed board meeting. Keyworth admitted to the leaks in May and stepped down on Sept. 12 -- one day after Patricia Dunn first announced her resignation as chairman in January 2007. (On September 22, Dunn advanced her departure schedule from "January" to "immediately.") Keyworth says that he believes his statements were in the best interests of the company and that no confidential or damaging information was disclosed in his "leaky" conversations with the press.

How many people sit on the HP board of directors?

The HP biography page for its board of directors currently lists eight.

Did HP break the law?

There are plenty of investigators and lawyers figuring that out, but based on what we know now, it's possible that the company did not directly break the law. The outside firm retained by HP is on shakier ground, since they may have hired a subcontractor that did, in fact, break the law.

What did that subcontractor do?

It obtained phone call records by pretexting -- calling the phone company and claiming to be the people whose records it was after, using personal data to bolster their claims. The people targeted included HP board members and staff as well as nine journalists and their spouses. (Not the best tactic for keeping an embarrassing story out of the papers, by the way.)

Some legal observers feel that HP may just make new law on this -- providing a high-profile case that'll light a fire under legislators to crack down on the practice.

Did HP's legal department know this was happening?

Yes. Reports have stated that HP senior counsel Kevin Hunsaker planned an attack on at least one reporter and presented the details to Dunn in a PowerPoint presentation. (That attack involved placing a tracking bug in an e-mail on the reporter's computer; Hunsaker has not yet been linked to pretexting efforts.)

So one of those journalists found out and wrote about it?

Not quite. The investigation was revealed earlier this month in an SEC filing in which HP acknowledged hiring an outside investigator to run down leaks dating from 2005.

When did all this happen?

The two-part investigation began in March 2005 -- under the reign of previous CEO Carly Fiorina, by the way -- and ended in May 2006. An HP board member says the pretexting began in January 2006.

Is pretexting illegal?

Pretexting of bank records has been illegal in the U.S. since 1999 under the Gramm-Leach-Bliley Act. The Senate is currently looking at bills that would make phone-record pretexting illegal, and California -- where the journalist targeted by Hunsaker is based -- specifically forbids it, as does Maryland and a few other states. Illinois, Florida and Missouri are currently suing various online records brokers that engage in pretexting, and several mobile-phone-service providers have sued such companies as well.

Sounds expensive.

No. Some companies charge as little as US$100 per phone number.

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