Aug articles on stock option backdating
Karatz, 64, is one of the most prominent corporate executives to be charged criminally in the government’s long-running crackdown on options backdating. The scheme enabled him to make more than million in “secret pay,” Assistant U. Revenue soared under his watch, reaching a record billion in 2006.His character witnesses during the month-long trial included former Los Angeles Mayor Richard J. As a courtroom clerk announced the jury’s decision, Karatz sat stone-faced between two of his lawyers, and then left the courthouse without comment.“This is personally a challenging time,” he said in a statement later. His success enabled Karatz to become a major philanthropist, contributing to efforts to rebuild Los Angeles after the 1992 riots and New Orleans after Hurricane Katrina.Such companies as Broadcom, Apple, Deloitte & Touche, and others got caught up in investigations.The reason CEOs and boards hid the activity was the second part of the controversy.He said Ray changed his story to please prosecutors and to get them to give him a plea bargain.“Ray is not worthy of your trust. Dick, the juror, said he hoped that the judge would give Karatz probation and a big fine, but not jail time.“If he had just said, ‘I did it, I didn’t realize it was wrong’ … Of the backdating counts Karatz was acquitted on, Dick said most jurors believed the actions were “sleazy and unethical, but we couldn’t find the evidence” to convict.
Bruce Karatz, who helped turn Westwood-based KB Home into one of the nation’s most successful home builders during two decades as its chief executive, was convicted Wednesday on four felony charges related to the manipulation of executive stock options. Stock options allow employees to buy a certain amount of stock at a set price, typically the date on which they are granted.
The allegations of illicit sex, drugs, and rock and roll reminded me of the 60s ... Sure, Broadcom had to take a .2 billion charge to fix the accounting mess left by the company's former executives.
But how does that relate to hiring prostitutes and drugging customers without their knowledge?
But during cross-examination, Ray said he initially told FBI agents that he didn’t think there was anything wrong with way the company timed its stock options.
Asked about the discrepancy by Karatz’s lawyer, Ray explained, “I lied.”During his closing argument, defense attorney Keker told the jury of nine men and three women that the prosecution’s case hinged on Ray’s testimony, which he said lacked credibility because of Ray’s admitted lies. He also argued that Karatz never intended to defraud shareholders and was acting with the knowledge of company accountants and lawyers when he set option grant dates.