Other People’s Money

Investors often cheer when companies buy back their own shares, and sometimes it sends an even more bullish signal when directors dip into their own pockets to purchase company stock.Investec Private Bank hopes to make it easier for CFOs to buy their own companies’ shares. Two years ago, the Angl...

By Eila Rana • Dec. 10, 2007

CFO Points Finger at Ex-Employer

A former finance chief for Apollo Group testified that the company kept secret a seemingly damaging report about its pay policy, Bloomberg reported. Kenda Gonzales, who in November 2006 resigned as CFO of the company best known for owning the for-profit University of Phoenix, told a jury in a se...

By Stephen Taub • Dec. 7, 2007

The $468 Million Clawback

William McGuire, the former CEO of UnitedHealth Group, has agreed to pay a whopping $600 million to settle claims with federal regulators and his former employer over the company’s illegal backdating of stock options.Under Section 304 — the “clawback” provision — of the Sarbanes-Oxley Act, McGuir...

By Stephen Taub • Dec. 6, 2007

The Risks of Not Being Green

Pressure from institutional investors and state governments has compelled corporations in recent years to beef up their efforts to curb carbon emissions and fulfill disclosure requirements to share their environmental risks in their financial reports.Now, the heat is rising even faster. As deman...

By Sarah Johnson • Dec. 6, 2007

Hedge Fund Favors Flushing Poison Pill

A prominent hedge fund is calling on PeopleSupport Inc. to rescind its poison pill or amend it in a way that would allow more potential acquirers to make a bid for the company. IPVG Corp. and AO Capital Partners last week made an unsolicited bid to acquire PeopleSupport in an all-cash transactio...

By Stephen Taub • Dec. 6, 2007

Backdating Bites Another HR Exec

A second former executive at Brocade Communications Systems was found guilty in a case involving the backdating of stock-option grants to employees.Stephanie Jensen, who was the company’s vice president of human resources, was convicted following a two-week jury trial on one count of conspiracy a...

By Stephen Taub • Dec. 6, 2007

Ex-Maxim CFO Won’t Settle

The Securities and Exchange Commission has charged Maxim Integrated Products and its former CEO and CFO with reporting false financial information to investors by improperly backdating stock-option grants. The company as well as ex-CEO John Gifford agreed to settle the charges, but the former CF...

By Stephen Taub • Dec. 5, 2007

Legal Separation for Insider-Trading Couple

A former Morgan Stanley finance executive and her husband were each sentenced to 18 months in prison for trading on insider information relating to acquisitions of three publicly traded companies. Jennifer Wang, a former Morgan Stanley finance department executive, and her husband, Rubin Chen, a...

By Stephen Taub • Dec. 5, 2007

Icahn Gets His from Temple-Inland

Two subsidiaries of Temple-Inland Inc. have obtained $2.14 billion in financing from a group of lenders affiliated with Citibank.The company said it will use the proceeds to pay a special dividend of $10.25 per share, or about $1.1 billion; reduce debt by $700 million, which includes its recently...

By Stephen Taub • Dec. 4, 2007

Dell to Repurchase $10 Billion of Stock

Dell is moving forward with a massive, $10 billion buyback of its common stock, equal to nearly 20 percent of its market capitalization.The personal computer giant, which recently became current with its regulatory filings, told shareholders at its annual meeting that it will resume repurchasing...

By Stephen Taub • Dec. 4, 2007

Shareholders Gang Up on FormFactor

Shareholders are suing FormFactor Inc. for allegedly failing to disclose and misrepresenting material adverse facts.The class-action lawsuit, at least the second of its kind filed against FormFactor in the past few weeks, stems from the company’s announcement in late October that it would be unab...

By Stephen Taub • Dec. 4, 2007

Sustainability Reporting: Earth in the Balance Sheet

Three weeks before Al Gore won the Nobel Peace Prize for his efforts to sound the alarm on climate change, a coalition of investors, state governments, and environmental groups was sounding an alarm of its own. It petitioned the Securities and Exchange Commission to require publicly traded compan...

By Scott Leibs • Dec. 1, 2007

A Tale of Six Cities

When Erik Prusch joined Borland Software Corp. last year, his top priority was making the company profitable after two years of losses. Critical to achieving that goal was the relocation of company headquarters from Silicon Valley to “Silicon Hill,” otherwise known as Austin, Texas, where the com...

By Alix Stuart • Dec. 1, 2007

Loyalty Programs Prepare for Takeoff

Are frequent fliers about to fly solo? Airline loyalty programs may soon become stand-alone businesses as struggling carriers consider unlocking the growth potential of these highly profitable units. “Separating the frequent-flier plan from the airline could drive short-term appreciation in airli...

By Avital Louria Hahn • Dec. 1, 2007

Restating Your Case

Restatements have become an increasingly common fact of life for finance departments, with 1 out of every 10 U.S. public companies restating their financials in 2006. They’ve become so widespread, in fact, that some of the stigma may be fading, according to a recent study by the Public Company Ac...

By Kate O'Sullivan • Dec. 1, 2007

Debating the Need for Speed

Accelerated share repurchases (ASRs) can boost a languishing stock and lead to a sustained rise in share price, but at what cost?Companies that take the ASR route buy all the shares up front from an investment bank that has borrowed them from investors; the bank then buys the shares back on the m...

By Vincent Ryan • Dec. 1, 2007

VP of HR Faces Prison for Backdating

A former vice president of human resources at Broadcom Corp. has agreed to plead guilty to obstruction of justice in connection with a government investigation of options backdating, according to the U.S. Attorney’s Office for the Central District of California.Nancy Tullos was accused of instruc...

By Stephen Taub • Nov. 30, 2007

Criminal Injustice?

Critics of criminal justice in countriesranging from the United States to Korea havelong complained of a glaring imbalance:white-collar criminals typically receive fargreater leniency than other crooks. Could asimilar inconsistency exist within companies?A new study of economic crime suggeststhat...

By Don Durfee • Nov. 30, 2007

Officers Who Conceal Backdating, Beware

Delaware Court Chancellor William B. Chandler III, in another tough opinion in the case involving alleged stock-option backdating at Maxim Integrated Products, found that a corporate officer who knows about an improper practice but doesn’t report it could be subject to the court’s jurisdiction an...

By Roy Harris • Nov. 29, 2007

Risky Business

If a major financial crisis were to hitAsia today, the chances are that globalizingcompanies in China and Japan will find themselveswoefully unprepared. That’s the finding ofa new study by IBM, which recently polled 1,230CFOs worldwide, 25 percent of them from Asia-Pacific. “Chinese enterprises (...

By Cesar Bacani • Nov. 29, 2007

SEC Snubs Proxy Access

The Securities and Exchange Commission on Wednesday specifically authorized companies to deny including in proxy statements shareholder resolutions relating to director nominations. Supporters saw the hotly debated measure, widely known as proxy access, as a way to further democratize corporate ...

By Stephen Taub • Nov. 28, 2007

JDS Uniphase Wins Rare Securities Trial

JDS Uniphase has won a securities class-action lawsuit, which rarely get decided by a jury.On Tuesday, jurors for the U.S. District Court for the Northern District of California ruled in favor of the company on all claims filed by Connecticut Retirement Plans and Trust Funds. Nearly five years ag...

By Stephen Taub • Nov. 28, 2007

Perpetrators Punished in Share-Inflation Case

A federal court has entered a final judgment against the former CFO and CEO of a penny-stock company, who were found guilty of running a scheme to boost the company’s share price. The ex-CFO, Michael Pietrzak, and the ex-CEO, Maurice Furlong, fraudulently inflated the value Hexagon Consolidated C...

By Stephen Taub • Nov. 27, 2007

SEC Fishes for Info on Mortgage Insurers

The Securities and Exchange Commission is investigating two mortgage insurers regarding their joint investment in Credit-Based Asset Servicing and Securitization (C-BASS), a troubled investor in subprime mortgages.MGIC Investment Corp. said in a regulatory filing that the SEC requested documents ...

By Stephen Taub • Nov. 21, 2007

Investor Sues AIG over Subprime Mess

There always seem to be new problems for American International Group. On Tuesday a California shareholder filed a derivative lawsuit against the insurer and its top executives and directors over its exposure to the subprime-mortgage crisis, the Associated Press reported.The lawsuit, brought by D...

By Stephen Taub • Nov. 21, 2007