ECONOMICS REPORT - 'Pretexting' Spells Trouble for Hewlett-PackardBy Mario Ritter

Broadcast: Friday, September 15, 2006

This is the VOA Special English Economics Report.


Patricia Dunn

Computer-maker Hewlett-Packard announced this week that the chairwoman of its board of directors will resign in January. How Patricia Dunn came to be forced out after less than two years is a complex story.

It involves Hewlett-Packard's use of investigators who gained private telephone records of board members and reporters. Miz Dunn ordered the investigation after private details of board meetings appeared several times in news reports.

To get the phone records, the investigators used pretexting. Pretexting is when private investigators identify themselves as someone else so they will be given personal information. Commonly they identify themselves as the person whose records they seek.

H-P is based in Palo Alto, California. The attorney general of the state, Bill Lockyer, discussed the case on national television Tuesday. He said there is enough evidence to bring criminal charges against people inside and outside the company. Federal officials are also investigating the case.

Patricia Dunn and the man appointed to replace her, H-P Chief Executive Officer Mark Hurd, have apologized for the methods used. She says the investigation was necessary but that it went beyond what we understood.

The investigators reported that board member George Keyworth gave information to CNET News. The former science adviser to President Ronald Reagan is a longtime Hewlett-Packard director. In May, the board asked Mister Keyworth to resign. He refused. But his friend, board member Thomas Perkins, resigned in protest over the company's actions.

In June, Mister Perkins wrote to Larry Sonsini, an outside lawyer for H-P, to ask for details of the investigation. Mister Sonsini, in an e-mail back, said pretext calls were made to phone service providers. But he said the process appeared within legal limits.

Some members of Congress are now calling for federal laws against pretexting.

Patricia Dunn is to remain on the board after she resigns as chairwoman in January. She replaced Carly Fiorina who in February of last year was forced to resign as chairwoman and H-P's chief executive. Carly Fiorina had led H-P to take over Compaq Computer. The move was opposed by some directors and the families of the two men who started Hewlett-Packard.

And that's the VOA Special English Economics Report for this week, written by Mario Ritter. Archives of our reports are the Web at www.unsv.com. I'm Steve Ember.