Securities: Tyco Pays to Settle Fraud Suits

The industrial company Tyco International Ltd. has agreed to pay three billion dollars in order to settle shareholder lawsuits alleging securities and accounting fraud by its former management. The agreement has been reached after a five year legal battle and is related to Dennis Kozlowski's actions. Kozlowski currently is serving a 25-year jail term for having stolen hundreds of millions of dollars from the company. Tyco says that it is setting up a $2.975 billion cash fund to compensate investors. Lawyers for the plaintiffs say that by the time the accord is approved in court, the fund could increase to over three billion dollars.

Tyco to pay 3 billion dollars to settle fraud suits

Lawyers who represented the shareholders say that the deal is "the single largest payout from any corporate defendant in the history of securities class-action litigation." Jay Eisenhofer, a managing partner at one of the law firms representing the shareholders, says that "this is a fantastic resolution and closes a chapter on one of the largest and most appalling examples of corporate fraud in US history."