Twin Cities Companies Cited for Backdating
Bookmark & ShareJuly 18, 2006
Source: St. Paul Pioneer Press
Civil and criminal charges for stock-option practices could be coming soon. The Securities and Exchange Commission is poised to bring its first-ever case targeting abusive stock-option practices, an area where problems appear widespread, SEC Chairman Christopher Cox said Monday. "These are not merely episodic instances," Cox told reporters. Abuses such as backdating stock options appear to have been a "widespread problem" especially in the 1990s, according to Cox, who said the SEC will bring its first backdating case "very soon." Dozens of companies, including Minnetonka-based UnitedHealth Group, have acknowledged requests for information from regulators about their backdating practices. UnitedHealth, which launched an internal review of its options program, has warned that it may have to restate past earnings, erasing nearly $290 million. A report issued over the weekend found that more than 2,200 U.S. companies may have manipulated the timing of stock-option grants to executives between 1996 and 2005. The study was conducted by Randall Heron at the Kelley School of Business at Indiana University, and ERIK LIE of the Henry B. Tippie College of Business at the University of Iowa.
Contact: Erik Lie, ,
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