Prosecutors presented no proof that the former chief financial officer for Tyco International Ltd. looted the conglomerate of hundreds of millions of dollars, his lawyer said Monday during his closing statement.
“They threw a lot of charges against the wall, hoping some would stick,” said Charles Stillman, who represents Mark H. Swartz. “Well it didn’t work. A 10-pound slab of clay is just that, a 10-pound slab of clay. Don’t confuse volume with substance.”
Swartz and former CEO L. Dennis Kozlowski are accused of stealing $170 million from Tyco by hiding unapproved pay and bonuses and by abusing loan programs. They also are accused of illegally making $430 million by pumping up the value of Tyco stock through lies about the company’s finances from 1995 to 2002.
Swartz and Kozlowski faces charges of grand larceny, falsifying business records and violating state business laws. The grand larceny charge is punishable by up to 25 years in prison.
Kozlowski’s lawyer, Stephen Kaufman, was expected to begin his summations Tuesday. The prosecution was to present its final arguments Wednesday, and the judge said the jury may get the case on Thursday.
On Friday, State Supreme Court Justice Michael Obus threw out a count of enterprise corruption, one of the most serious against the two defendants. The charge, punishable by up to 25 years in prison, alleged the two men created an organization specifically to commit crimes.
Outside court Friday, Kozlowski said the dismissal of the charge was “a positive” thing, but that he remained uneasy. “Of course I’m nervous,” he said.
The enterprise corruption statute was modeled after the federal RICO (Racketeer Influenced Corrupt Organizations) law, often used to prosecute organized crime gangs.
Stillman said Monday that the evidence shows that all of the bonuses Swartz received were consistent with the way Tyco applied its bonus plan for executives throughout his tenure at the company.
“They are not larcenies,” he told the jury.
Prosecutors say millions of dollars went to finance elaborate lifestyles, fund personal investments and silence some employees who were in positions to expose the defendants.
Tyco, which has about 270,000 employees and $36 billion in annual revenue, makes electronics and medical supplies and owns the ADT home security business.
