H-P Insiders Charged

Though the scandal has tarnished H-P's reputation and resulted in the resignation of several high-level employees, investors have so far shrugged off the importance of the affair on the premise that it has little bearing on the company's day-to-day operations and its earnings.

Most significantly for investors, CEO Mark Hurd, who has been leading an 18-month turnaround of the company's business, has so far managed to avoid getting entangled in the affair.

Although Hurd approved and signed off on various aspects of the leak investigation, he has denied knowledge of any of its more unsavory and illegal aspects.

The California Attorney General's Office is among several different agencies and regulatory bodies looking into efforts by H-P to discover the source of media leaks. The U.S. Department of Justice and the Securities and Exchange Commission's Enforcement Division are also looking into the affair.

Last week, members of the U.S. House of Representatives grilled H-P CEO Mark Hurd, former Chairwoman Dunn and others in a seven-hour hearing about the affair.

During her testimony, Dunn insisted she believed that the phone records were accessed in a lawful manner and said she had never heard of the concept of pretexting until recently.

Wednesday's indictment seems to contradict her testimony, however. According to the indictment, Dunn was allegedly informed by a private investigator that phone records had been obtained by ruse in June 2005 during the first phase of the investigation.