SEC Drops Altera Options Probe

Altera announced Tuesday that the Securities and Exchange Commission has ended its investigation of the company’s stock-option practices and will not recommend any action against the company.The microchip maker disclosed last June that it would restate its financials for the prior 10 years to cor...

By Dave Cook • Feb. 20, 2007

PCAOB’s Niemeier: No Sarbox Rollback

Charles Niemeier, a member of the Public Company Accounting Oversight Board, warned policy makers and other critics that they may damage the reputation and competitiveness of U.S. markets if they roll back the Sarbanes-Oxley Act and other securities laws, reported Reuters.Niemeier made his remark...

By Stephen Taub and Dave Cook • Feb. 16, 2007

Kennedy to SEC: Probe Sallie Mae Execs

This article has been updated since it was published on February 16. The original article stated that five Sallie Mae executives, including CFO Charles Andrews, sold stock within 10 days of the release of President Bush’s 2008 budget proposal; in fact, the trades were mandatory transactions relat...

By Marie Leone • Feb. 16, 2007

DoJ Won’t Refloat “Enron Barge” Case

The Justice Department will not seek to overturn last summer’s appeals court decision to throw out most of the convictions against former Merrill Lynch executives charged in the infamous Enron barge case, according to The Houston Chronicle.Federal prosecutors had until Friday to appeal the 5th U....

By David Katz • Feb. 16, 2007

Not Invented Here

A seemingly mundane dispute over gas-pedal design may result in aSupreme Court decision that would invalidate patents deemed too “obvious.” And that may be bad news for, among others, companies that rushed to patent E-commerce business processes such as one-click transactions.The case, involving ...

By John McPartlin • Feb. 15, 2007

Insurer to Give Investors ”Say on Pay”

Insurance company Aflac announced on Wednesday that it will become the first major company to provide shareholders with a non-binding vote on executive pay packages.The disability insurer, well-known for television ads featuring a very persistent duck, reportedly came to its decision in response ...

By Stephen Taub • Feb. 14, 2007

SEC Closer to Recognizing IFRS

The Securities and Exchange Commission will take another step toward recognizing International Financial Reporting Standards at a roundtable on its IFRS “roadmap,” scheduled for March 6.In the United States, foreign private issuers can already prepare regulatory filings using IFRS but must reconc...

By Dave Cook and Stephen Taub • Feb. 13, 2007

For CA’s Kumar, Prison Must Wait

Sanjay Kumar — who admitted his role in the $2.2 billion fraud at Computer Associates, where he was chief executive officer — has been granted a two-month reprieve from prison, according to published accounts.Last April, reported Newsday, Kumar pleaded guilty to eight counts: securities fraud, co...

By Dave Cook and Stephen Taub • Feb. 13, 2007

Ignorance Is a Defense

Directors around the country sighed with relief late last year when the Delaware Supreme Court ruled for the defense in Stone v. Ritter, a lawsuit involving director liability at AmSouth Bancorporation. The court clarified its views on director liability, reaffirming the landmark 1996 Caremark de...

By Kate O'Sullivan • Feb. 12, 2007

Not All Backdaters May Be Charged: SEC

The Securities and Exchange Commission will pick its spots when deciding which companies should be the targets of backdating actions, a senior official stated on Saturday.During a panel discussion at the annual SEC Speaks conference in Washington, D.C., associate director of enforcement Antonia C...

By Stephen Taub • Feb. 12, 2007

Judge Certifies NovaStar Class Action

A federal judge has certified a lawsuit against NovaStar Financial as a class action, reported The Kansas City Business Journal.Filed in April 2004 on behalf of shareholders by Milberg Weiss Bershad Hynes & Lerach, the class action reportedly claims the Kansas City, Missouri-based subprime le...

By Stephen Taub • Feb. 9, 2007

Working Group Eyes ”Say on Pay”

A number of major companies and activist investors have formed a working group to determine the feasibility of giving shareholders an advisory vote on executive compensation, reported the Associated Press.The group, which will first meet on Friday at the Manhattan offices of investment firm TIAA-...

By Stephen Taub • Feb. 8, 2007

Time Warner, Calstrs Settle for $105M

The California State Teachers’ Retirement System (Calstrs) announced Wednesday that it settled a securities fraud lawsuit against Time Warner, as well its accountants, banks, and several former executives, for $105 million.The lawsuit charged that the media giant’s AOL unit artificially inflated ...

By Stephen Taub and Dave Cook • Feb. 8, 2007

Buy American (Unless You’re Foreign)

Fear that foreign ownership of U.S. companies might undermine national security is hurting investment in this country, a new report says.The report, released January 25 by the National Foundation for American Policy (NFAP), says that regulatory reviews of foreign investments in U.S. firms have in...

By Meghan D. Brady • Feb. 7, 2007

What Keeps Bankers Awake at Night?

When the great, the good and the media assembled in Davos for the World Economic Forum in January, one topic dominated the financial agenda — risk. That ought to be a good sign. For it is when those in charge are feeling complacent that disaster is most likely to happen. Investors also seem nervo...

By Economist Staff • Feb. 7, 2007

Allied Capital: Son of HP?

It looks like Hewlett-Packard was not the only company caught snooping into the phone records of people it was investigating. Allied Capital Corp. said that in late December 2006, it received a subpoena from the United States Attorney’s Office for the District of Columbia requesting, among other ...

By Marie Leone • Feb. 6, 2007

Bush Puts SEC Budget on a Diet

President Bush is asking Congress for a 3 percent budget increase for the Securities and Exchange Commission as part of his $2.9 trillion government funding plan for fiscal year 2008. The increase brings the SEC budget request to $905 million, slightly higher than the 2007 continuing resolution ...

By Marie Leone • Feb. 6, 2007

SEC Opens Probe of Quality Systems

Quality Systems, which makes software for medical records, disclosed that the Securities and Exchange Commission has launched an investigation of trading activity in the its securities.The company added that the SEC is also seeking documents and records concerning Paul Holt, chief financial offic...

By Stephen Taub • Feb. 6, 2007

SEC Names Kroeker to Accounting Post

The Securities and Exchange Commission has named James L. Kroeker as deputy chief accountant for accounting in the Commission’s Office of the Chief Accountant.Kroeker will be responsible for resolution of accounting issues, rulemaking projects, and oversight of standard-setting efforts for privat...

By Stephen Taub • Feb. 5, 2007

Investigation Dilemma: Sing or Keep Mum?

If your company — like so many these days — is conducting an internal investigation, beware. Your interrogators may work for the same company you do, but they’re essentially government deputies, legal experts say.In 2004, executives of CA (previously known as Computer Associates), including forme...

By Helen Shaw • Feb. 2, 2007

Investors Sue Dell over Alleged Kickback

Investors are accusing Dell Inc. of an accounting kickback scheme involving chipmaker Intel Corp., according to a report in The Wall Street Journal. In a lawsuit filed on Wednesday, investors charge that Dell is being paid as much as $1 billion annually by Intel to assure that Dell uses only Inte...

By Marie Leone • Feb. 2, 2007

Sarbox on Ice?

Although it’s not even five years old, there’s no question that the Public Company Accounting Oversight Board has seen better days.Currently the target of a lawsuit that threatens its existence, the PCAOB has also been criticized by its boss, the Securities and Exchange Commission, for burdening ...

By David Katz • Feb. 1, 2007

More Backdating Suits Coming, Says Cox

Securities and Exchange Commission chairman Christopher Cox sent a stark warning on Wednesday to companies that have engaged in improper timing of stock option grants.Speaking to reporters, Cox said that the commission is vigorously proceeding with probes at more than 100 public companies and tha...

By Stephen Taub • Feb. 1, 2007

Qwest Pays $45M to Settle with Calstrs

Qwest Communications has agreed to pay $45 million, and former chief executive officer Joseph Nacchio, $1.5 million, to settle a lawsuit by the California State Teachers’ Retirement System (Calstrs).The nation’s second-largest pension fund estimated that it lost $150 million, reported the Associa...

By Stephen Taub • Feb. 1, 2007

Bush on ”The State of the Economy”

President Bush said executives’ pay should be linked to their company’s performance and urged board members to better monitor executive compensation, but he expressed opposition to government efforts that would give shareholders more say in the matter.Bush also called for certain changes regardin...

By Stephen Taub • Jan. 31, 2007