Apollo Takes Aim at Backdating Settlements

Apollo Group Inc. received preliminary approval for a settlement of two derivative lawsuits filed stemming from the backdating of stock options.The for-profit education company that operates the University of Phoenix system said in a regulatory filing that on April 18 and on April 28 a federal Di...

By Stephen Taub • May 5, 2008

On the Hill, Trying to Put Plaintiffs’ Bar on the Defensive

With class-action attorney William Lerach almost set to start his two-year prison sentence, some Republican lawmakers in Washington are giving Corporate America more to celebrate as they seek to turn up the heat on the conduct of class action lawyers across the country. Last Friday, House minorit...

By Kate Plourd • May 5, 2008

After Six Years, SEC Goes on Atkins Diet

Securities and Exchange Commissioner Paul Atkins, after nearly six years in office, said Monday that he will leave the agency this summer.Atkins has worked for the SEC for a decade, serving in various positions under three different chairmen. First appointed as a commissioner in 2002, he is now i...

By Alan Rappeport • May 5, 2008

Parmalat Investor Recovery Hits $90 Million

Parmalat SpA has announced that it settled a securities class action with investors stemming from its stunning collapse in 2003. Under the deal, the Italian dairy giant will distribute 10.5 million shares of stock. That works out to a little less than $40 million, based on Parmalat’s Thursday clo...

By Stephen Taub • May 2, 2008

Patents under Pressure

Anyone who has ever made a purchase on Amazon.com using its “1-Click” checkout option can’t help but be impressed by the convenience. Register your personal, credit, and delivery information once and all subsequent purchases require only a single mouse-click. The concept is simple, ingenious — an...

By Marie Leone • May 1, 2008

A New Top Cop for Corporate Finance?

Tucked away among the five new regulators called for in U.S. Treasury Secretary Henry Paulson’s blue-sky blueprint for reforming the financial-services industry is an authority of special interest to CFOs: a corporate finance regulator.Under the long-range provisions of the U.S. Treasury’s Bluepr...

By David Katz • May 1, 2008

All in the Families

Pssst…Looking for a stock tip? So are federal investigators, and their efforts may have ramifications for CFOs. A recently reinvigorated Securities and Exchange Commission task force, having brought charges against 11 Wall Street insiders and three hedge funds a year ago, is now paying close atte...

By Alix Stuart • May 1, 2008

SEC Joins Mounties in Tangled Nortel Case

Three former Nortel Networks Corp. finance executives settled Securities and Exchange Commission fraud charges stemming from their alleged involvement in Nortel’s earnings management fraud during 2002 and 2003.Craig A. Johnson, James B. Kinney, and Kenneth R.W. Taylor, who were the vice presiden...

By Stephen Taub • May 1, 2008

Audit-rate Spurt Tempers Sarbox Savings

Corporate spending on compliance with the Sarbanes-Oxley Act’s Section 404 fell sharply again last year, and so did overall auditor costs. But a 5-percent spurt in average audit fees cut deep into the savings, according to a new survey from Financial Executives International.The average cost for ...

By Stephen Taub • April 30, 2008

Ex-Monster Controller Faces Backdating Charges

The Securities and Exchange Commission charged the former controller and the former president of Monster Worldwide Inc. for their alleged roles in a multiyear scheme to secretly backdate stock options for thousands of Monster officers, directors, and employees. The SEC complaint alleges that form...

By Stephen Taub • April 30, 2008

What’s Wrong with this Pixar?

The former chief financial officer of Pixar Animation Studios is likely to be charged by the Securities and Exchange Commission stemming from her role in a stock-option backdating scandal.Pixar, based in Emeryville, Calif., was acquired by Walt Disney Co. for $7.4 billion in 2006.Last week Ann Ma...

By Stephen Taub • April 29, 2008

Weathering the Storm?

Among all the other havoc that global climate change is expected to wreak, it also could take a toll on corporations’ business models. At least, that is the finding of a survey conducted by Storm Exchange, a firm that makes money helping companies cope with weather-related risk, and CME Group, a...

By Stephen Taub • April 29, 2008

Siemens Study Finds Rampant Abuses

A prominent international law firm hired by scandal-plagued Siemens AG to investigate bribery and corruption charges dating back to the late 1990s found evidence of violations of domestic and foreign compliance regulations.Debevoise & Plimpton LLP’s report says many of the violations were due...

By Stephen Taub • April 29, 2008

Whole Foods “Blogging” Probe Dropped by SEC

Whole Foods Market said the Securities and Exchange Commission has ended its inquiry into financial message-board postings by CEO John Mackey, and that the commission recommended no enforcement action against the company or any individual.In July 2007 the natural-foods retailing chain disclosed t...

By Stephen Taub • April 28, 2008

At BlueRay, Ex-CFO Sues to Make Finances Public

A former BlueRay Technologies Inc. finance chief, fired last year in part for not disclosing prior legal problems, is suing the company to make it disclose financial records, BlueRay said in court papers filed last week. The former finance official, Yelena Simonyan, is suing as a shareholder, acc...

By Stephen Taub • April 28, 2008

Accountant Guilty of Helping CEO Commit Fraud

A former financial executive has admitted her role in a fraud that resulted in the bankruptcy of a now-defunct bottled-drinks maker.Tammy Andreycak, who was director of accounting for Le-Nature’s Inc., pleaded guilty in federal court in Pittsburgh to charges of bank fraud, wire fraud, conspiracy,...

By CFO Editorial Staff • April 25, 2008

Jail after All for Ex-HealthSouth Finance Exec?

A former HealthSouth assistant controller whose original sentence had spared him prison time may be headed there after all.A federal appeals court once again has granted a government request to vacate the earlier sentence handed down for Kenneth K. Livesay, who received house arrest and probation...

By Stephen Taub • April 24, 2008

SEC Gears to Stiffen Rules for Wall Street

The collapse of Bear Stearns Cos. appears to be leading the Securities and Exchange Commission to impose higher capital requirements on investment banks.The SEC is meeting with Wall Street banks that have lost money from the mortgage crisis to discuss the possible requirement to set aside more ...

By Stephen Taub • April 24, 2008

For Creditors, Enron’s End of the Line

A U.S. Bankruptcy Court approved Enron CreditorsRecovery Corp.’s $1.66-billion MegaClaims litigation settlement withCitigroup, effectively closing the suit.The money returned to Enron creditors through this and other arrangements will bring the total of such creditor returns to $20 billion, accor...

By Stephen Taub • April 24, 2008

Frank Prods SEC to Study Auction-Rate Havoc

House Financial Services Committee Chairman Barney Frank wants to know what the Securities and Exchange Commission is doing to investigate the sale of auction rate securities and the havoc caused in that market this year. The Massachusetts Democrat and Rep. Paul Kanjorski, chairman of the Subcom...

By Sarah Johnson • April 24, 2008

The Looming Battle over Sovereign Wealth Funds

Congress continued to express concern about the future of sovereign wealth funds and their potential threat to the American economy and foreign policy. But Securities and Exchange Commission and Federal Reserve officials tried to ward off efforts to regulate the foreign government-run funds too q...

By Alan Rappeport • April 24, 2008

Feds: Adelphia Fraud Victims Can Ask for Their Money Back

Michael J. Garcia, U.S. attorney for the Southern District of New York, announced that victims of the securitiesfraud committed at Adelphia Communications can ask the U.S. Attorney General to recover parts of their financial losses that were directly caused by the fraud.In July 2004, founder Joh...

By Stephen Taub • April 24, 2008

Fannie and Freddie Warned to Play “Fair”

The regulator that oversees Fannie Mae and Freddie Mac warned the government-chartered buyers of mortgages to be judicious in using fair-value accounting rules, according to the Washington Business Journal.The publication said that the issue focuses on Accounting Standard No. 159, Fair Value Opti...

By Stephen Taub • April 23, 2008

Taming the Beast

Bankers, erstwhile masters of the financial universe, are not used to being spoken down to. But just days after the industry resolved, in the words of Deutsche Bank’s Josef Ackermann, to “clear our house first and not leave it to the regulators to do it for us”, the Group of Seven finance ministe...

By Economist Staff • April 21, 2008

Cox’s Top Lawyer to Leave SEC

Michael J. Halloran, Securities and Exchange Commission chairman Christopher Cox’s go-to guy on a wide range of issues, will leave the SEC in May to return to the private sector. Halloran is one of the inner-circle officials at the SEC who has worked closely with the chairman. Serving as counselo...

By David Katz and Marie Leone • April 21, 2008