THE OPTIONS SCANDAL: SEC AND PRIVATE, ENFORCEMENT TRENDS, REED R.
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Our culture idolizes entrepreneurs — hoisting them up on impossibly high pedestals and demonizing them when they inevitably fall from grace.
That dysfunctional dichotomy says more about our childish attitudes toward business leaders than it does about them.
after making more than $100 million off his record label, his clothing line, and a vitamin water company acquired by Coca-Cola.
He’s not broke, mind you; just using the court system to stiff creditors for million.
In late December of 2001, Im Clone founder and CEO Sam Waksal tipped off family and friends that his company’s new cancer drug, Erbitux, was about to be rejected by the FDA.
He was convicted on insider trading and tax evasion charges and served five years in federal prison. You may not feel empathy for these entrepreneurs and I doubt they deserve it. But what many successful business leaders lack in humility and ethics, they more than make up for in vision and tenacity.
Around the same time that events were unfolding at Im Clone, the tech industry was embroiled in a far reaching scandal: stock option backdating.
Executives at dozens of tech companies received back-dated stock options to take advantage of lower exercise prices. One of the companies hardest hit by the scandal was Apple.
By 2008, dozens of top executives from Altera, Broadcom, Brocade, Cirrus Logic, KLA-Tencor, Mc Afee, Take Two, Verisign more than a dozen other technology companies had lost their jobs over the fallout. In 2006, the Securities and Exchange Commission (SEC) investigated two large backdated option grants: one for 4.8 million shares to the company’s executive team and another for 7.5 million shares to Jobs, who was CEO at the time.