Feeds

SEC charges two over Apple options backdating

Ex-CFO hands back $3.5m of gains

The Power of One Infographic

Updated The Securities and Exchange Commision (SEC) today accused Apple's former top lawyer of fraudulently backdating options to under-report company expenses by $40m.

Nancy Heinen is also accused of altering company records to conceal the fraud. She is contesting the charges, the WSJ reports today.

The SEC also filed charges against former CFO Fred Anderson for being asleep on his watch. He should have noticed what Heinen had done, the regulator said. It has already settled with Anderson, who will kiss goodbye to $3.5m worth of option gains. The settlement won't see Anderson admit any wrongdoing.

Anderson will also pay a fine of $150,000 to the government agency, which has been trawling Silicon Valley for foul play in the awarding of options during the tech boom.

Options backdating was a favoured way for tech firms to attract and award talent, particularly in the frothier days of the dot com boom. It referred to the setting of option prices not at the price the day they were granted but at another, typically earlier day, when the price was lower. This gave the option more room to increase in value by the time the execs cashed them in.

The practice is not illegal, as long as the backdating is disclosed to shareholders and the relevant authorities. It was the small matter of informing shareholders that seems to have defeated many leading firms in the information technology industry.

Apple coughed to backdating options earlier this year, offering to make up the shortfall to employees who were affected.®

Boost IT visibility and business value

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple ran off to IBM
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.