Suffolk businessman quits public roles while fighting fraud allegations
PUBLISHED: 15:04 05 December 2018 | UPDATED: 16:33 05 December 2018
A businessman accused of fraud in the United States over the sale of his company to technology giant Hewlett-Packard (HP) has stepped down from a number of public roles while fighting the charges.
The allegations against Suffolk tech tycoon Mike Lynch, who owns a Georgian country manor house set in 69 acres near Woodbridge, date back to the sale of his Cambridge-based ‘big data’ firm Autonomy to Hewlett-Packard back in 2011 for $11bn.
The charges allege that between 2009 and 2011, Mr Lynch and Mr Chamberlain and other alleged co-conspirators artificially inflated Autonomy’s revenues by overstating them, as well as making misleading statements to regulators and market analysts covering the company.
Mr Lynch has denied the charges, with a statement from his attorneys saying he has “done nothing wrong and will vigorously defend the charges against him”.
Since then, Mr Lynch has become an investor in technology start-ups via his Invoke Capital venture fund, which owns about one third of Darktrace, a cybersecurity company that was valued at $1.7bn in September.
Yesterday, Mr Lynch announced that he was quitting his post as a director at Darktrace.
A spokesman for Darktrace said: “Mike Lynch is a visionary technologist and has been an invaluable advisor and mentor to Darktrace. He offered to step down from the board so as not to create a distraction for the company, but we remain very grateful for his advice and support.”
Mr Lynch has also quit from his role as a UK government advisor and a member of committees at the Royal Society, although he remains a fellow.
He is also exiting the board of another company Invoke invests in, the Switzerland-based Sophia Genetics, which develops technology for genomic data analysis.
But a spokesman for Mr Lynch explained that his board membership at Sophia Genetics would have run its natural course this month anyway, irrespective of recent developments.
In a statement, Sophia Genetics chairman Antoine Duchateau said: “Mike has been a fantastic supporter and we thank him hugely for his time on the board.”
A spokesman for Invoke Capital explained that Mr Lynch’s stepping down public roles was “his decision alone and, whilst it’s a shame, it’s the right thing to do”.
Mr Lynch now has to decide whether to fly to the US to contest the charges in court, or fight extradition from the UK.
Lawyers for Mr Lynch claim that the claims were a “business dispute over the application of UK accounting standards, which is the subject of a civil case with HP in the courts of England, where it belongs”.
Mr Lynch’s Suffolk bolthole, where he keeps a herd of rare breed cattle, is the place he retreats to in order to switch off from the stresses of the business world.
In an interview with the Telegraph several years ago, when asked for his strategy for coping with pressure, Mr Lynch replied: “I live in rural Suffolk, which is a place that is 50 years back in time, and the conversation down the pub is the same as it has been for the last 100 years, which is how do you catch moles – which is a great unsolved problem, a bit like Fermat’s last theorem was – and I find that when I am there and turn off the device, that’s what gives me my recharge.”
But the bar manager of Mr Lynch’s local pub was bemused that Mr Lynch thought mole-catching would be a popular conversation topic in the area. “I can honestly say I have never had a conversation like that with anyone,” he said.