Tuesday, May 23, 2006

SEC widens stock option probe

The New York Times reports that at least 15 companies are under investigation by the U.S. Department of Justice, SEC or both regarding their practices of granting stock options. The concern being that some companies may have issued options to executives back dating them to a time when the stock price was lower to ensure that the executives made money on their options.

"The stock-option game is supposed to confer the potential for profit, but also some risk," said John Freeman, a professor of business ethics at the University of South Carolina Law School.
The New York Times article linked here.

Hat tip to Joe of the Pinehurst Thread for the link.

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