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Lie Releases New Stock Option Study

Almost a third of U.S. companies that issue stock options have manipulated their grants to top executives at some point in the past decade, according to a new study by two finance professors. The growing scandal that some have said is the "next Enron" has seen 60 companies investigated by prosecutors. Apple Computer is the largest firm implicated although it has launched its own probe and is not under scrutiny by the authorities. ERIK LIE of the University of Iowa said he was reluctant to publish the number, as he knew it would create media interest but he was satisfied it was correct. Lie and Indiana University's Randall Heron are co-authors of three academic studies that helped expose the questionable timing of many options. Lie and Heron's latest study estimates that 29.2 percent of the companies that were studied manipulated grants to top executives at some point between 1996 and 2005. The firms under study account for about 95 percent of those that grant options, Lie said. The newspaper is based in London, England.

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