Any money taken by two former Tyco International executives that wasn’t authorized in the company’s records is “wrongful, plainly and simply,” a prosecutor told jurors Wednesday.
Assistant District Attorney Marc Scholl said L. Dennis Kozlowski and Mark H. Swartz stole millions by abusing Tyco executive programs, and then made sure that favored colleagues would share in the bounty to cover their own tracks.
“These thefts were wiped off Tyco’s books,” Scholl said in the second day of closing arguments by the prosecution.
Kozlowski, Tyco’s former chief executive officer, and Swartz, the former chief financial officer, are accused of looting Tyco of $600 million to finance baronial lifestyles and fund pet investments.
Defense lawyers argued earlier that many of the bonuses and forgiven loans that Kozlowski and Swartz received had been approved by the board of directors’ compensation committee in informal, unrecorded sessions.
Swartz had testified that many meetings had been held, while no records were kept.
But Scholl said, “The only voice claiming these were authorized bonuses is the voice of Mark Swartz.”
The prosecutor, who began his arguments late Tuesday after summations from Assistant District Attorney Ann Donnelly, also said that Tyco’s ledgers prove that Kozlowski and Swartz stole from the company.
“The ledgers show that this is not merely a theft, but a planned theft by agreement,” Scholl said.
Kozlowski, 57, and Swartz, 43, are accused of stealing $170 million by taking unauthorized bonuses and by abusing company loan programs. They allegedly netted $430 million more by inflating the value of Tyco stock by lying about the company’s finances.
The judge was expected to charge the jury on Thursday.
Kozlowski and Swartz are charged with a total of 32 counts of grand larceny, falsifying business records and violating state business laws. The grand larceny charge — a mega-larceny under state law since it alleges theft of more than $1 million — is punishable by up to 25 years in prison.
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. Nominally based in Bermuda, its operations headquarters are in West Windsor, N.J.