HP's snowballing shame

Buggin' hell

By Chris Williams • Get more from this author

Posted in Financial News, 20th September 2006 14:48 GMT

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And the hits just keep on coming. The latest embarrassments for HP include claims of bugging its own chief executive, attempting to install a trojan on a reporter's computer, and the forthcoming spectacle of their ousted chairwoman hauled before a congressional committee.

Patricia Dunn, who was allowed to quietly shuffle away from the chair by the rest of the HP board, will appear before the House Committee on Energy and Commerce in hearings beginning September 28.

The committee will vote today on whether to assume powers to fast-track subpoenas to squeeze HP for information. So far HP's submissions on the reporter scandal have been voluntary.

Like the Californian Attorney General and FBI, Congress' interest has been piqued by allegations of "pretexting" - where private investigators illegally obtain phone records under false pretenses.

The New York Times reports one of the CNET reporters targeted by HP's goons also received a document from them via email with an embedded trojan. The spying program failed to install itself correctly however.

And in yet another twist, The San Jose Mercury reports Carly Fiorina, predecessor as chairman, CEO and president, to the recently promoted Mark Hurd, was spied on by her own investigation. Fiorina, eager to trace the source of leaks, launched the orignal bugging operation in 2005.

HP's crisis management PR machine is struggling with the snowballing scandal. Spokesman Ryan Donovan said Monday: "The only thing I would say about the current investigation is the intent was the right intent. Information was leaked from the company that was potentially damaging and had ability to move stocks, which is not a good thing."

Call us naïve, Ryan, but we reckon investors prefer the movement of stock to be based on information rather than no information, damaging or not. In fact - hold the phone - isn't that how a market economy is supposed to work? ®

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