Sept. 28 (Bloomberg) -- Hewlett-Packard Co. Chief Executive Officer Mark Hurd described the company's probe into boardroom leaks as a ``rogue operation'' that spiraled without his knowledge into potentially illegal spying.

Hurd told a U.S. House committee hearing in Washington that he left oversight of the probe to others, including Chairwoman Patricia Dunn, who was ousted last week for her role in the investigation.

``This was not the CEO's No. 1 priority,'' Hurd said. He said he didn't review the decisions made during the probe. ``The CEO cannot be the backstop for every process in the company.''

Hurd said he accepted responsibility for not taking a more active role, helping distance himself from the probe that included surveillance of directors and journalists and use of false identities to gain phone records. The scandal, which cost Dunn, General Counsel Ann Baskins and two executives their jobs, has drawn scrutiny from regulators and is likely to lead to indictments by the California Attorney General.

Lawmakers rebuked the executives for not digging deeper into the methods used in the investigation, which extended to following directors, planting spyware on reporter's computers and going through trash. Investigators for the Palo Alto, California-based company also took on false identities to obtain phone records, a practice known as pretexting that may be illegal.

Legal Assurance

Dunn earlier told the committee that she was assured that the tactics used were legal and wasn't made aware of the pretexting until July 2006. She attributed the blame to Baskins and her legal department. Lawyers for Baskins, who resigned today, produced documents that show she was repeatedly told the methods were above the law.

Baskins was among 10 lawyers and investigators involved in the probes who refused to testify today, invoking their Fifth Amendment right not to incriminate themselves. Kevin Hunsaker, the company's ethics officer who ran the probe, and Anthony Gentilucci, Hewlett-Packard's global security chief, both declined to answer questions.

Their decision sparked concerns that some of the behavior may have been illegal, said Joel Reidenberg, law professor and founding director of the Center on Law and Information Policy at Fordham Law School.

``At best, the kind of spying that appears to have taken place in the HP context is pretty sleazy,'' Reidenberg said. ``It sounds like the methods used are likely to be illegal.''

Distancing

Hurd and Dunn both tried to distance themselves from the investigation and the tactics used to uncover the identity of the person leaking the information. Dunn, who spent more than four hours fielding questions, denied knowing about the pretexting until mid-2006, said she didn't supervise the probe and won't take the blame.

Dunn, 53, painted herself as the victim of investigators who kept her out of the loop, while Hewlett-Packard has depicted its former chairwoman as complicit in, or at least responsible for, the actions of the investigators.

``I do not accept responsibility for what happened,'' she said in answer to a question from Representative Clifford Stearns, a Florida Republican.

The hearing today is part of an eight-month inquiry by the House Committee on Energy and Commerce's Subcommittee on Oversight and Investigations into pretexting and today's session is dubbed ``Hewlett-Packard's Pretexting Scandal.''

Pretexting is ``pretending to be someone you're not, to get something you shouldn't have, to use in a way that's probably wrong,'' said Representative Joe Barton, chairman of the U.S. House Committee. ``We must make pretexting clearly illegal.''

Common Methods

Dunn had the support of seven of the nine board members to conduct the probe, she said, adding that she chose to work with the investigators on the recommendation of director Robert Wayman. She also indicated that pretexting may be common practice at Hewlett-Packard, the world's second-largest personal-computer maker.

``I believe that these methods may in fact be quite common not just at HP but at companies around the country,'' Dunn said.

Hurd said he wasn't aware of other pretexting.

Dunn said she received assurances through two phases of the probe, dubbed Kona 1 and Kona 2, that the methods used to obtain phone records were legal. Dunn also denied claims from investigator Ronald DeLia that she was aware the company was using pretexting to obtain phone records.

``This was not something I understood until early July of 2006 as a possible component of either investigation,'' Dunn said, referring to two probes set up by the company.

Asked about claims from DeLia that he briefed Dunn earlier than then on the ways the investigators got information, she replied: ``At a minimum I don't recall it. I don't agree with Mr DeLia's testimony.''

Red Flags

Documents released by the committee revealed a series of e- mails that could have served as red flags for Hewlett-Packard officials.

Hewlett-Packard official Vince Nye wrote an e-mail to Hunsaker and Gentilucci in February 2006 raising ``serious reservations'' about pretexting. ``It is very unethical at the least and probably illegal. If it is not totally illegal, then it is leaving HP in a position that could damage our reputation or worse.'' Nye said the pretexting should stop immediately.

A report by DeLia in July 2005 showed he had received the phone records of Business Week reporters as well as two directors and outside counsel Larry Sonsini. He discussed plans to obtain Fiorina's phone number to gain access to her records.

Getting Excited

E-mails between Hunsaker and Gentilucci show little regard for their actions. Hunsaker said ``I'm starting to get excited'' after being told by DeLia in an e-mail that he had found calls between director George Keyworth and Cnet.com reporter Dawn Kawamoto. The calls indicated Keyworth may be leaking information. Gentilucci replied ``good work team.''

``We have a fine case study in deceit, dishonesty, improper behavior, probably criminal misbehavior and we have a fine display of arrogance, cover up and probably gross stupidity,'' Representative John Dingell, the ranking Democrat on committee said at the hearing today.

Representative Greg Walden, a Republican from Oregon, said the conduct was ``outrageous.'' ``Where was somebody to say this just isn't right?'' Walden said in his opening statement. Dingell, from Michigan, asked the Hewlett-Packard officials assembled for the hearings ``What were you thinking?'' He described the behavior as ``shameful'' and worse than Keystone Kops.

Representative Ed Whitfield, a Republican from Kentucky, said he gives ``little credence'' to the arguments that the company and executives didn't know its investigators were using unsavory tactics.

To contact the reporter on this story: Connie Guglielmo in San Francisco at cguglielmo1@bloomberg.net; Christopher Stern in Washington at cstern3@bloomberg.net.

Last Updated: September 28, 2006 19:10 EDT