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Erik Lie's Research Has Rocked Corporate America

Academic research conducted by a mild-mannered UNIVERSITY OF IOWA professor, ERIK LIE, is at the epicenter of a still-widening backdating scandal that has trashed the careers of some of the nation's leading corporate executives, tainted corporate reputations from coast to coast and spurred federal officials to launch a criminal investigation. Through some inspired number crunching conducted largely in his tiny campus office, Lie came up with data that provide near-ironclad proof that hundreds, and most likely thousands, of U.S. corporations have been secretly manipulating the dates on the stock options they grant to their executives. By doing so, those companies perverted what was intended to be a performance-based incentive plan into a shower of free money. Although the financial reverberations have been substantial for corporate America, Lie's life hasn't changed much at all. Even his students don't seem all that aware of his prominent role in kicking up the biggest corporate scandal in years. And that's just fine with Lie, who never sought the spotlight: "I like my life here in Iowa City. I like doing research. My life, it hasn't really changed that much beyond the extra time I spend talking on the phone."


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