10 Percent Of Pre-2002 Options May Be Backdated
Bookmark & ShareJune 11, 2006
Source: Baltimore Sun
William McGuire probably deserves to be well-compensated for building UnitedHealthcare from next to nothing into a health care giant. But $1.5 billion? That number -- the value of McGuire's unexercised stock options -- could have become merely the flash point for another round of garden-variety hand wringing over excessive executive pay. But McGuire now stands accused in shareholder lawsuits of gaming his company's options program to ensure the maximum possible payout. Those claims might just become Exhibit A in a burgeoning scandal that could land as many executives in courtrooms as Enron, WorldCom, Tyco and Adelphia put together. McGuire is accused of backdating stock options -- a phrase likely to make the average reader's eyes glaze over. So think of it this way: The betting windows at Pimlico just reopened. If you bet on Barbaro, go on over and reclaim your money. ERIK LIE, a University of Iowa finance professor whose research was the basis for a run of Wall Street Journal articles exposing the practice, estimated last week in an interview with Bloomberg News that up to 10 percent of all option awards before 2002 may have been backdated.
Contact: Erik Lie, ,
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