Sec investigation stock options backdating companies Bosna girlchat
From a consumer's perspective, customers rely on companies to provide goods and services.When those firms have no ethical boundaries, their wares become suspect.Late last year, Apple said that Jobs helped pick some favorable dates but that he "did not appreciate the accounting implications." Explaining Anderson's motive for issuing the statement, his lawyer Jerome Roth said: "We thought it was important that the world understand what we believe occurred here." Roth said his client, a prominent Silicon Valley figure and a managing director at the venture capital firm Elevation Partners, will not be barred from serving as a public-company officer or board member under the settlement, in which Anderson did not admit wrongdoing.Roth declined to characterize the current relationship between Anderson and Jobs.Betting on stock prices when you already know the answer is dishonest.A business run without integrity is a scary proposition.
When senior executives realized that they could look backward for the date during which their firm's stock was at its lowest trading price and then pretend that was the date they were issued the stock grants, a scandal was born.
The roots of the scandal date back to 1972, when an accounting rule was put in place permitting companies to avoid recording executive compensation as an expense on their income statements so long as the income was in the form of stock options that were granted at a rate equal to the market price on the day of the grant, often referred to as an at-the-money grant.
This enabled companies to issue enormous compensation packages to senior executives without notifying shareholders.
(See also: .) As a result, firms restated earnings, fines were paid and executives lost their jobs—and their credibility.
The SEC reported that investors suffered in excess of billion in losses due to share price declines and stolen compensation.