HP Chairman Accused of Spying on Board Members

Published: September 12, 2006

by Timothy Prickett Morgan

Call it a sign of the times. Governments and companies never like information leaks, and if anything, the level of intolerance for leaking information--which is the backbone of investigative reporting--is growing. Which is why it is not exactly a surprise to read in Newsweek that a former HP employee, venture capitalist, and board member--Tom Perkins--who mysteriously quit being a board member in May, has revealed that he did so because HP chairman Patricia Dunn initiated a private investigation of board members to find out who was leaking information to the press.

Apparently, according to the Newsweek report, Dunn was concerned about reports in IT trade rag CNET News.com that discussed the inner deliberations of the HP board of directors as they wrestled with the issues surrounding ousted chairman and chief executive officer, Carly Fiorina. Information in those stories could only have been based on information from a board member. So, after Fiorina was fired in February 2005 and Dunn was named chairman, she hired some private investigators to try to figure out who was the leaker on the board. And, according to documents Perkins filed with the Securities and Exchange Commission, these investigators used a practice called "pretexting," to obtain personal phone records of HP board members.

Pretexting is calling up and pretending to be someone or to be close enough to someone to warrant getting their personal information. Where I come from, they call this "lying." And, no matter if Dunn was right to try to find the leaker on the HP board, the ends do not justify the means--even if you outsource the dirty work. The former CEO of Barclays Bank should have known that, which is what Dunn used to do before she became chairman of HP.

The question now will be if Dunn is done. The board could toss her out and bring Perkins back in as chairman. Perkins was an early employee hired by Bill Hewlett and Dave Packard, and was the first manager of HP's computer business as well as one of the founders of Silicon Valley venture capitalist firm Kleiner Perkins Caufield & Byers. He is certainly qualified.