Seven Years Later, HP’s Pretexting Scandal Is Finally Over
With so many other things going on at Hewlett-Packard — an accounting scandal, huge write-offs, a herculean effort to turn its business fortunes around as the PC and printer markets it leads shrink — it seems almost ridiculous to look back to 2006 and the boardroom spying scandal. But, as Yogi Berra famously said, “It ain’t over till it’s over.”
The last bit of messy business associated with that sequence of events was wrapped up yesterday in a nearly empty courtroom in San Jose, Calif. Empty, that is, except for Wired’s Robert McMillan.
It was there that Bryan Wagner, a player in the explosion of corporate drama that rocked HP, attracted national attention, spawned books, congressional hearings and profiles on “60 Minutes,” was sentenced to three months in jail. He had pleaded guilty in 2007 to charges of aggravated identity theft, and had faced a minimum sentence of two years in prison.
Wagner was among those who conducted the “pretexting,” a fancy word for impersonating a person to try and get access to their cellphone billing records. It is a federal crime. Once a private investigator in Colorado, he had been introduced to the idea of pretexting by a relative, and considered it “a gray area.”
It all started in early 2005, following a front-page story in The Wall Street Journal about discussions held at a special HP off-site strategy meeting that included details known only to directors. HP’s then chairman Patricia Dunn launched an investigation to determine who among the company’s directors was leaking confidential information to reporters at The Wall Street Journal, the New York Times, CNET and Businessweek Magazine. (In the interest of full disclosure, I worked at BusinessWeek during this period.) It was called Operation Kona.
In an effort to get to the bottom of the leaks and discover the source, she hired a private investigation firm which in turn farmed some of the work out to subcontractors, who were the ones who did the pretexting. The technique proved illegal; Dunn later testified to Congress that she had believed the investigators had used only legal methods to get the information. In 2006, Dunn and Wagner were among five people criminally charged by the California State Attorney general in the matter. They were also among those charged at the federal level. California later dropped its charges against Dunn and the federal charges were later thrown out by a judge, owing in part to the fact that she was in the late stages of breast cancer. She died last year.
Wagner, on the other hand, will go down as the only player in the pretexting scandal to see the inside of a prison cell. Others criminally sentenced received probation.