More corporate scandal - Option Backdating.
SEC, FBI and federal prosecutors are investigating close to 60 companies to determine if they have manipulated grant dates and exercise prices of stock options to boost the profits attainable by corporate executives.
This may actually cost all investors because across corporate America there could be severe changes in the insurance policies for directors and corporate officers. The insurance policies are generally used to protect top executives and board members from personal losses for the decisions that they make while on the job.
Not only are insurance rates expected to rise, but insurers could also become more restrictive in the coverage they offer or what they pay out in claims. Who will get stuck with the tab for such policy changes? Shareholders at public companies!
Some of the companies involved are: UnitedHealth Group, Vitesse Semiconductor Corp, Affiliated Computer Services Inc. and Comverse Technology.
Related link: Option Backdating Scandal
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