Brocade and Mercury Interactive have coughed up $35m between them to settle charges they deliberately flouted SEC rules by falsifying dates of stock option grants.

Mercury is stumping up $28m to settle civil fraud charges brought today by the US Securities and Exchange Commission against it and four former executives for the "fraudulant and deceptive" award of shares through backdating.

As for former chief executive Amon Landen, former chief financial officers Sharlene Abrams and Douglas Smith, and former general counsel Susan Skaer, the SEC alleges these officers aided and abetted violations of antifraud laws between 1997 and 2005. The commission's investigation is still in progress.

Brocade will pay $7m to settle SEC charges of falsifying reports of income through backdating and misreporting of compensation expenses between 1999 and 2004. Again, Brocade neither admitted nor denied any wrongdoing.

The commission has charged former chief executive George Reyes, former vice president of human resources Stephanie Jensen, and former chief executive Antonio Canova with fraud and other securities law violations.

The Brocade trio were the first Silicon Valley executives to be hauled up and formally charged by the FBI and SEC with separate civil and criminal charges last July. The executives each face a maximum penalty of 20 years jail and $5m fines.

At the time, feds warned Silicon Valley more charges would follow unless there was a good reason for any misdating of stock - a widespread practice intended to lure talent during the dotcom boom. Since then, IT companies Valley-wide have been keen to show good faith and have combed through old accounts to search for and re-adjust backdated stock allocations. ®

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• Brocade ex-CEO guilty of options fraud (7 August 2007)
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• Apple board backs Jobs against ex-CFO allegations shock (25 April 2007)
• Updated SEC charges two over Apple options backdating (24 April 2007)
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• Options scandal claims CNET, McAfee chiefs (11 October 2006)
• Ex-Brocade pair plead not guilty (31 August 2006)
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• Magistrate rejects ex-Brocade chief's dismissal application (10 August 2006)
• Brocade is just the beginning - warns SEC chief (21 July 2006)
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