The SEC Is Getting Closer To Jobs 154
Strudelkugel writes "CNN is reporting that Apple's ex-CFO warned Steve Jobs about backdating options. From the article: 'Apple's former finance chief Fred Anderson blamed Apple CEO Steve Jobs for a 2001 stock option grant that was backdated, according to a statement from Anderson's lawyer released Tuesday. The statement was released by Anderson's lawyer, Jerome Roth, after Anderson settled with the Securities and Exchange Commission related to Apple's stock option plan without admitting or denying any wrongdoing.' This is serious business. It is quite possible that the SEC could someday require Jobs to resign from Apple."
More Likely than Resignation (Score:5, Insightful)
Probably a standard, overblown scare (Score:5, Insightful)
Sensationalist crap (Score:0, Insightful)
Thank you for your editorial...
Comment removed (Score:5, Insightful)
Re:Probably a standard, overblown scare (Score:5, Insightful)
That stock price chart merely reflects that the market hates uncertainty, the announcement of anticipated news always brings an up tick, as uncertainty is removed.
The uncertainty, in this case, was on possible "smoking guns" revealed as part of Fred Anderson's settlement. There were none, his "punishment" was minimal, and as soon as the market processed this information the temporary downturn (during the period of imperfect information when traders are unsure if they have the full story) reversed and Apple's stock went higher than opening.
I am sure Steve Jobs broke many laws (Score:2, Insightful)
Anderson's Full Text (Score:3, Insightful)
"Fred Anderson has a long-standing impeccable reputation and is widely regarded as one of the most ethical CFO's in the nation whose extraordinary contributions to Apple's success during his eight-year tenure are unquestioned. He is accurately recognized by many current and former Apple employees and throughout the industry as a man of exceptional ability, achievement and integrity. "With respect to today's announced settlement by the SEC of its complaint against him, Fred is pleased to put this matter behind him. "In the settlement Fred makes no admission or denial of the claims by the SEC. The terms of the settlement permit Fred to continue to act as an officer or director of public companies and do not bar him from practicing before the SEC. The claims against him also do not include fraud under the two antifraud provisions of the securities laws requiring proof of knowing misconduct. "With respect to the Executive Team grant that is the subject of the complaint against him: * Fred was told by Steve Jobs in late January 2001 that Mr. Jobs had the agreement of the Board of Directors for the Executive Team grant on January 2, 2001. At the time Mr. Jobs provided Fred this assurance, Fred cautioned Mr. Jobs that the Executive Team grant would have to be priced based on the date of the actual Board agreement or there could be an accounting charge. He further advised Mr. Jobs that the Board would have to confirm its prior approval in a legally satisfactory method. He was told by Mr. Jobs that the Board had given its prior approval and the Board would verify it. Fred relied on these statements by Mr. Jobs and from them concluded the grant was being properly handled. * Fred understood that, under Apple's stock option plan and accounting rules at the time, a grant date could be moved to a later date than the date of the actual grant decision and that there would be no compensation expense as long as the stock price on the new date was higher than the price on the original date. Apple's 1998 Executive Officer Stock Option Plan provided in Section 16 that 'The date of grant of an Option...shall be, for all purposes, the date on which the Administrator (in this case the Board) makes the determination granting such Option...or such later date as is determined by the Administrator '. Mr. Anderson understood that the date of grant was to be moved forward pursuant to this provision from January 2 to January 17 to avoid any appearance of impropriety that might arise from a grant awarded just prior to the stock price rise that resulted from the 2001 MacWorld exhibition and Mr. Job's keynote speech at the exhibition on January 9. He further understood that the January 17 date was selected by Mr. Jobs and Ms. Nancy Heinen, the former General Counsel, and that the stock price on January 17 was higher than the price on January 2. * Finally, Mr. Anderson understood that the Board of Directors, which consisted of sophisticated corporate executives of national stature, including the former Chief Financial Officer of IBM, verified the January 17 date by signing in early February 2001 a Unanimous Written Consent (UWC) with an effective date of January 17. It now appears the Board may not have given the necessary prior approval to the grants, contrary to what Mr. Anderson understood from Mr. Jobs and from the Board's signing of the UWC with an effective date of January 17. "Mr. Anderson has agreed to pay disgorgement, the difference in the value of the stock between the January 17 date and the date in early February when the UWC was signed by the Board. "With respect to the October 2001 grant to Mr. Jobs that is also the subject of the complaint, Fred had virtually no involve
Re:Apple without Jobs (Score:2, Insightful)
Yeah, when Apple sucked. I'm not saying Jobs would have done a better job than Scully and his sucessors, but they certainly managed to do an awful job, and simply coast on the "cool" that Jobs and Woz lent to the company.
Re:Despite it all (Score:3, Insightful)
Yes, because it's much more important to have three or four random people mod you up than it is to clearly and articulately get your point across.
Re:More Likely than Resignation (Score:5, Insightful)
2. A lawyer's prepared statement is designed to give wiggle room while implying certain things that put the client in a favorable light or make the client appear innocent. See my breakdown of the statement:
- Fred didn't play a "day to day" role
-> could mean
- Fred wasn't in charge of that, so he's not responsible for misconduct.
- Fred was in charge of that, but he wasn't involved in the details, so someone else committed misconduct and he's not responsible for it.
- Fred was in charge and is officially responsible for the misconduct, but he didn't know about it because he can't review _everything_ that happens or else he couldn't do his main job-- helping the company make money for shareholders.
-> implies
- Fred is innocent.
- Fred is above the fray.
- Fred is too important to have committed misconduct.
- Fred couldn't have known about misconduct because he doesn't know all the details.
- Whoever committed misconduct hid it from Fred.
- "in the granting, reporting, and accounting of stock options."
-> could mean
- Fred doesn't have the authority to grant stock options (true: the Board of Directors may be the only entity that can grant stock options).
- Fred isn't involved in reporting stock options to the SEC or shareholders.
- Fred isn't involved in auditing/accounting.
- Fred has authority to grant stock options but it's not one of his more significant duties.
- Fred is involved in reporting to the SEC, but since reports to the SEC don't come out on a day to day basis, the statement is true.
- Fred is involved in accounting of stock options, but since auditing and accounting isn't done on a day to day basis, the statement is true.
-> implies
- Fred is not responsible for misconduct.
- Fred is above the fray.
- Fred can manage a public company's finances in the future because he did nothing wrong here.
- Fred knows nothing.
- "he was not involved in any knowing manipulation of the process"
-> could mean
- Fred manipulated the process unknowingly.
- Fred was involved in manipulating the process but didn't know the extent of his role.
-> implies
- Fred didn't