The consequences of backdating executive stock options
With respect to both, there are pending parallel criminal actions as well.As most of you know, the Comverse criminal case has had a certain amount of drama surrounding former CEO Kobi Alexander, who was first a fugitive from justice, and later was located after he took up residence in Namibia, where he is presently fighting extradition to the United States.Meanwhile other legal and regulatory developments occurred that created distinctions between in the money and at the money options.These developments also tended to favor at the money grants.From my perspective, the collective efforts by the SEC are a model way of addressing an issue proceeding from various perspectives to come up with practical and wide-ranging solutions. I'd like to address this on two fronts first, I'll discuss how we got to our efforts at the Commission and then I'd like to step even further back and talk about some of my impressions on how we ended up with the option issues we are confronting.First, on the SEC front, our investigations are born of a conscious effort to proactively think about where problems might be, to methodically inquire whether there actually are problems, and then to pursue the best ways to address any problems that exist.Looking backward, I'll ruminate a little about how we got here, and finally, at the risk of appearing to be or worse, actually being the secular equivalent of a sanctimonious twit, offer some thoughts looking forward on lessons we might take away from all of this. I have reached the point in life where I view the world through ridiculously expensive progressive lenses, but I guarantee you these lenses are not rose-colored. To recap much of what you may already have read or heard, the Division of Enforcement is investigating over 100 matters relating to potential abuses of employee stock options.
They also generally received more favorable tax treatment.
Our Office of Economic Analysis then analyzed data and refined the areas of concern.