Feeds

Former Brocade boss gets 21 months in prison

Switch sensei sized for stripes

The essential guide to IT transformation

Gregory Reyes, the former chief of Brocade, today was sentenced to 21 months in prison and fined $15m for masterminding a securities scheme using backdated options.

Reyes was the first executive in the US who went to trial over the improper dating of stock-option awards. Altering the date of stock options records so they appear to have been awarded when the price was lower has been a popular — and legal — trick in the tech industry for some years. Unfortunately, so has failing to disclose it with investors and federal regulators. That part...not so legal.

The US government eventually caught wind of the widespread shenanigans in 2006. Since then, 17 executives at eight companies have been charged with illegal backdating offenses.

Reyes originally faced up to 20 years behind bars at his conviction in August for 10 counts altering records and lying over option practices. However, his sentenced was fixed at 21 months, with US District Judge Charles Breyer ruling that Brocade didn't suffer a quantifiable monetary loss as a result of Reyes' scheme.

At the sentencing today, the judge said he also took into account Reyes' contributions to charity. The former CEO will remain free while he appeals his conviction.

Reyes wept as he read a statement that apologized for his actions.

"I'm sorry," Reyes said. "There is much that I regret, and if I could turn back the clock, I would. There were many things I would have done differently."

Stephanie Jensen, a second Brocade executive charged with participating in the company's illegal backdating, was found guilty in December. Her sentence will be delivered on March 12. ®

The essential guide to IT transformation

More from The Register

next story
GCHQ protesters stick it to British spooks ... by drinking urine
Activists told NOT to snap pics of staff at the concrete doughnut
Britain's housing crisis: What are we going to do about it?
Rent control: Better than bombs at destroying housing
What do you mean, I have to POST a PHYSICAL CHEQUE to get my gun licence?
Stop bitching about firearms fees - we need computerisation
Top beak: UK privacy law may be reconsidered because of social media
Rise of Twitter etc creates 'enormous challenges'
Redmond resists order to hand over overseas email
Court wanted peek as related to US investigation
Ex US cybersecurity czar guilty in child sex abuse website case
Health and Human Services IT security chief headed online to share vile images
We need less U.S. in our WWW – Euro digital chief Steelie Neelie
EC moves to shift status quo at Internet Governance Forum
prev story

Whitepapers

Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Advanced data protection for your virtualized environments
Find a natural fit for optimizing protection for the often resource-constrained data protection process found in virtual environments.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.