Ex-Tyco CEO Settles Case For $21.2M

Former Tyco CEO Dennis Kozlowski enters Manhattan State Supreme Court, Tuesday, Jan.18, 2005, in New York. Jury selection began today in his retrial of corporate corruption.
AP
Former Tyco CEO L. Dennis Kozlowski agreed Friday to pay $21.2 million to settle a New York state tax case related to his grand larceny conviction for looting the company.

The amount covers sales taxes that Kozlowski owed on the purchase of artworks, as well as money he owed for state income taxes, according to defense lawyer James DeVita and Assistant District Attorney Ann Donnelly. The sales tax case began as a criminal prosecution.

The tax investigation preceded accounting scandals which resulted in the grand larceny convictions last June of Kozlowski and former Chief Financial Officer Mark H. Swartz. The two were charged with looting hundreds of millions of dollars from Tyco to finance their lavish lifestyles.

The tax deal was announced before state Supreme Court Justice Michael Obus.

Kozlowski still owes about $70 million in fines and $97 million in restitution stemming from his grand larceny conviction.

DeVita said that $90 million has been raised by selling real estate and other assets.

Tyco is based in Bermuda but has an operating headquarters in West Windsor, N.J. It is best known for its home alarm systems. It is readying for a split by early 2007 into three separate operations: fire and security, electronics and health care.

Last week, Sotheby's auction house sold for a combined $7.9 million two paintings, a Monet and a Renoir, that once hung in a Manhattan apartment Kozlowski used. The money was to be put in escrow while lawyers sort out whether Tyco or Kozlowski was the owner.

Kozlowski and Swartz were sentenced to prison last year for grand larceny, conspiracy, securities fraud and falsifying business records, and are appealing their convictions. They are appealing their convictions.