Monster Settles in Options Backdating Case
May 20, 2009 by Lela Davidson
Filed under Finance
The Securities and Exchange Commission this week charged employment search provider Monster Worldwide, Inc. with secretly backdating stock options granted to thousands of Monster officers, directors and employees. Monster agreed to pay a $2.5 million penalty to settle the charges.
The SEC charged that Monster defrauded investors by granting backdated, undisclosed ‘in-the-money’ stock options without recording the required non-cash charges for option-related compensation expenses.
“Monster misled investors by failing to report hundreds of millions of dollars of expenses. Backdating stock options made the company look like it had more money than it really did,” said James Clarkson, Acting Regional Director of the SEC’s New York Regional Office.
The SEC charged that Monster filed false financial statements resulting in a cumulative pre-tax overstatement over the period of 1997-2005 of approximately $339.5 million. Without admitting or denying the SEC’s allegations, Monster will pay a $2.5 million penalty and promise not to do it again. Monster staff fully cooperated with SEC staff during the course of the investigation and currently operates under new management.
The SEC previously charged four of Monster’s former executives including CEO Andrew McKelvey, President and COO, James Treacy, General Counsel, Myron Olesnyckyj, and Controller, Anthony Bonica, for their alleged roles in the backdating scheme at Monster.
Moral of the story: It’s okay to be a monster, so long as you’re not a pig about it.
Image Credit: bacondog, Flickr
