The Five Dumbest Things on Wall Street This Week

2. Hurd Mentality

Hewlett-Packard (HPQ Quote) knows how to spin a nice spy yarn.

The Palo Alto, Calif., tech giant shook up its board Tuesday in a bid to snuff out an embarrassing surveillance scandal. The saga began this past spring, when venture capitalist Tom Perkins resigned his directorship in protest of Hewlett-Packard's handling of boardroom news leaks.

At first H-P downplayed the whole thing, but it now admits that it hired investigators in a leak crackdown. It concedes that private eyes snooped around directors' personal phone records without consent. It even apologizes for using "certain inappropriate techniques" in the probe.

California's attorney general sees possible criminal charges against individuals both inside and outside of H-P. The Justice Department and the Securities and Exchange Commission are investigating the company's actions. A dissident director, George Keyworth, says H-P has lost its moral compass.

"The invasion of my privacy and that of others was ill-conceived and inconsistent with H-P's values," Keyworth said Tuesday as he quit the board.

Values, schmalues, Hewlett-Packard replies. The company insists it didn't know any improprieties were taking place. What's more, it stands behind its spymaster and nonexecutive chairman, Patricia Dunn.

The investigations notwithstanding, H-P said Tuesday that Dunn will stay on as chairman through the end of the year. After that, she'll keep her board seat as CEO Mark Hurd takes over the chairman's post. And Hurd, buoyed by the stock's revival since he took over some 18 months ago for Carly Fiorina, isn't giving an inch to critics of the big brother act.

"On behalf of H-P, I apologize to Tom Perkins for the intrusion into his privacy," Hurd said in a press release Tuesday. "I thank Tom for his contributions, his principles and his help in getting H-P past this episode toward its rightful place as the envy of corporate America."

Even corporate America can't be jealous of this episode.

Dumb-o-Meter score: 91. Hurd is certainly thundering, we'll give him that.

To watch Colin Barr's video take of this column, click here.