Jobs and Options Backdating Scandal: Is His Turtleneck Lined in Teflon?

Ann All

The stock options backdating scandal is a cause that is yielding plenty of effects.

 

Among them: Legal counsels are leaving companies in droves, and the Securities and Exchange Commission is rolling out new rules requiring companies to be more transparent about perks awarded to executives.

 

And, oh yes, a growing list of chief executives are expected to face federal securities fraud charges. One CEO not yet on the list is Apple's Steve Jobs. Because Apple has been so prominently mentioned in press reports as one of the worst offenders in the backdating scandal, Jobs' omission has many folks wondering whether his iconic black turtleneck is lined in Teflon.

 

Jobs issued a public apology in October, saying that he knew about some of the backdating at Apple -- at least 15 instances between 1997 and 2002 -- but had not realized the legal implications involved. (It's worth noting that backdating is controversial, but not necessarily illegal. The devil tends to be in the details.)

 

Yet Jobs apparently didn't know that Apple's board had done some questionable things, including fabricating minutes for a board meeting that never occurred, to sweeten Jobs' compensation. (The often convoluted details are explained pretty clearly in this SiliconValley.com piece.)


 

Others at Apple -- including former CFO Fred Anderson and former General Counsel Nancy Heinen -- apparently won't be as lucky as Jobs. Both appear likely to face SEC charges.



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