Mr Richard Grasso, head of the New York Stock Exchange and a leading advocate of corporate governance reform, failed to disclose his stock ownership properly to financial regulators.
Mr Grasso and several other directors of Computer Associates did not file annual reports with the Securities Exchange Commission (SEC) over the past five years noting their stock awards from the company, according to the company's recent proxy filing.
Computer Associates claimed Mr Grasso's failure to file was the result of a misinterpretation by the company's legal department. Mr Grasso has since sent the proper documents to the SEC.
The episode is a reminder that even the most sophisticated executives can be tripped up by the tangles of securities regulations.
Mr Grasso is not the only high-powered Computer Associates director who failed to file the document, known as a Form 5, with the SEC. Former US Senator Mr Alfonse D'Amato, who chaired the banking committee, and three other board members were also noted in the company proxy.
Mr Grasso has become one of the most vocal proponents of corporate reform amid the current wave of accounting and other white-collar crimes as he tries to revive investor confidence in the markets.
Mr Grasso's spokesman at the NYSE declined to comment.
Computer Associates said the mistake was merely a "technicality" that would have no impact on its financial reports.
"Because director compensation is deferred until retirement, we and our directors did not believe that a Form 5 filing was necessary," it said, explaining the error. The disclosure is embarrassing for the company because it has been working hard to burnish its image under its new lead independent director, Mr Lewis Ranieri.
Mr Ranieri is best known for his days at Salomon Brothers, where he pioneered mortgage-backed securities during the period immortalised by Michael Lewis's book Liar's Poker.
Mr Ranieri has said he joined the Computer Associates board at the behest of Mr Grasso and Mr D'Amato. The company's recent proxy statement bears the hallmarks of the corporate reform that Mr Grasso has trumpeted.
There are eight pages dedicated to spelling out new corporate governance standards.
Among other things, they maintain that directors should attend all board meetings and should approach their assignments with "independence and integrity". - (Financial Times Service)
