SEC Close to Announcing its First Backdating Settlement with Issuer

The SEC apparently is getting closer to announcing the settlement of its first stock options backdating case with a company. Brocade Communications Systems is the first company charged with violating securities laws based on an alleged stock option pricing scheme, and may be the first hit with penalties.

There are over 130 cases are under review with the SEC, and more to follow in what chairman Cox described as a “very aggressive program,” so the annoucement of the first settlement with a company should set an important benchmark for future settlements. Up to this point, the DOJ and SEC have focused on individuals and the settlement of a case brought against a public company would create a benchmark and likely result in more settlements and actions.

For more information see stories in and the Financial Times. For analysis of related litigation involving Brocade’s former chief executive officer and former head of human resources, respectively, see the White Collar Crime Blog.

One Response

  1. […] Penalty to Settle Charges for Fraudulent Stock Option Backdating As reported in an earlier post, the SEC has, indeed, settled backdating claims against issuer Brocade Communications Systems, […]

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