SEC Investigating EDSSEC Investigating EDS

EDS has confirmed that it's under formal investigation by the Securities and Exchange Commission. The SEC is seeking information related to a financial forecast issued by EDS on Sept. 18. At the time, the company said its third-quarter earnings would come in as low as 12 cents. Earlier guidance from EDS had pegged earnings at 74 cents.

In a statement issued Tuesday, EDS said it's cooperating fully with the investigation. An SEC spokesman declined to comment. A formal order of investigation by the SEC gives commission staff the power to subpoena company records, by court order if necessary.

Separately, EDS says it has hired former Michigan Gov. John Engler to help the firm woo service contracts from state and local governments. Engler, who served as Michigan's governor from 1990 to 2002, is widely credited with making IT an integral part of state operations. He created Michigan's Department of Information Technology, which oversees implementation of numerous online services made available through michigan.gov.

He also spearheaded the establishment of the e-Michigan Office, which sets E-government policy initiatives. Engler, whom EDS has named president of state- and local-government operations, will report to Al Edmonds, president of EDS government solutions.