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CEO liar study mentions CA

Sanjay Kumar

Sanjay Kumar Photo Credit: Bloomberg

A new Stanford University study of the linguistic patterns of CEO liars mentions disgraced, imprisoned former Computer Associates chief executive Sanjay Kumar.

The study focuses on chief executives' word choices during telephone conference calls and interviews with analysts and reporters.

Telltale signs of falsehood are the tendency to use "we" instead of "I", and the overuse of superlatives.

An NPR story about the researchers, David Larcker and Anastasia Zakolyukina, mentions their take on a 2002 NPR interview with Kumar.

Kumar said in the interview, "There's no one out there today in the world of public companies who has the former chief accountant for the SEC running their audit committee. We do. There's no one out there who has the pre-eminent governance leader, professor [Jay] Lorsch, for example, running their governance committee. We do."

The NPR story says, "Kumar was asked, 'Can your books be trusted?' And he replied by saying, 'We hire the very best auditors.' Larcker says that can be a big warning sign.

"You basically are not answering the question. You're basically making reference to somebody else, and those are the kinds of things in psychology you look for," Larcker says.

The researchers have incorporated their data in a computer program that could function as a lie-detector — unless, of course, CEOs buy the program to alter their linguistic choices, NPR points out.

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