Steve Jobs will be grilled by the SEC
Surprise, surprise. The Securities and Exchange Commission (SEC) subpoenaed Apple's Steve Jobs. Jobs will be required to deliver a deposition regarding the SEC’s stock-options backdating case against former Apple General Counsel, Nancy Heinen. Giving a deposition does not directly incriminate Jobs himself, rather is a recorded testimony given under oath in a court for future use in trial.
The company was officially cleared of any wrongdoing by the SEC in April, however, individual civil cases were brought against Heinen as well as former Chief Financial Officer, Fred Anderson. Quick to settle out of court, Anderson agreed to pay a $150,000 fine and forfeit $3.5 million in profits gained from the options in question.
Last year it seemed possible Jobs would face legal problems after it was revealed that he received 7.5 million shares of unauthorized back-dated options in 2001. The options originally appeared to have been approved in the now infamous October 2001 board meeting that in reality never took place. Jobs however was given the support of Apple’s board of directors and ultimately cleared by what the company called an “independent investigation” of “outside directors.”
The SEC now appears to agree with Apple concerning Jobs and is instead focused on his long time associate Nancy Heinen. Heinen’s work with Jobs as company general counsel had spanned over a decade and two businesses. She is accused of having falsified record of the October meeting and later manipulating company records to cover her actions.
Although Apple's stock was down it still outperformed the NASDAQ on a day dominated by headlines involving the backdating scandal. Perhaps it is that investors are beginning to feel Apple’s CEO may be finally steering clear of the stock-options hazard.
In a recent Bloomberg interview, SEC lawyer Jahan Rasai stated it is uncommon for the SEC to add executives to an investigation this far developed. Steve Jobs is wildly popular amongst Apple investors and rumors of his departure due to this scandal have been credited with fueling volatility in this high beta stock over the past fiscal year.
"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA
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