Options backdating


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Options backdating

Awarding employees with stock options those are dated prior to the actual grant date. The date chosen could be one when the company’s stock was at a low, so the options can be in-the-money at the time of granting itself. The practice is illegal if it is not followed by proper disclosure and related expenses are not recorded in financial statements.
References in periodicals archive ?
of springloading); Hearing on Stock Options Backdating Before the S.
Options backdating has turned out to be more widespread than most believed.
Options backdating violated the accounting rules and, in many cases, the securities laws.
The report found that to date, the options backdating scandal has resulted in an unadjusted initial decline in market value of $5.
The Securities Class Action Clearinghouse, a database maintained by Stanford Law School, lists 21 securities fraud class actions involving allegations of stock options backdating.
But there are egregious things that become newsworthy, whether it's an Enron type of situation or now what we're seeing with the options backdating probe.
Robbins Geller is responsible for the largest securities class action recovery in history, the largest-ever options backdating recovery, the largest opt-out recovery, the largest credit crisis recovery, the largest corporate takeover recovery, and secured a historic jury verdict for the shareholder class after seven years of litigation and a six week trial against Household International, its CEO and CFO.
RUEHLE IS JUST ONE CHAPTER OF THE STOCK OPTIONS BACKDATING saga at Broadcom Corp.
Another possible cause for the decline in SCAs was the increase in options backdating cases, the vast majority of which were brought as derivative lawsuits, and which may have served to "distract" the plaintiff's bar from filing SCAs.
But the big crime--the one that has made all of the headlines--has been the massive stock options backdating scandal that not only forced McGuire to step down as UnitedHealth's CEO, but also served as one of the pivotal cases that thrust backdating into the spotlight as the biggest corporate accounting fiasco since the chicanery of Enron, et al.
McGuire serves as the poster boy for executives that deceptively lavished corporate funds on themselves by engaging in options backdating," says Chris Bebel, a former enforcement attorney at the SEC and now an independent attorney in Houston who serves as an expert witness in securities litigation.