Overnight the Financial Times reported that the forged stock option documents related to Steve Jobs’ grant of 7.5 million options in 2001.
The question now is, is it likely that Jobs knew that documents were being falsified for his granting of the 7.5 million options?
To the Macalope it seems highly unlikely that Jobs was not intimate with the details of his compensation, but most executives focus on “what am I going to get”, not the steps that might have been jumped over to get them there. Jobs, in particular, seems to be an individual who is comfortable as long as he knows he’s being handsomely rewarded for his Herculean efforts and only expects to make money if the company does well.
The company has stated that Jobs was not aware of the “accounting implications” involved. Is claiming something was approved at a board meeting when it was not an “accounting implication”? Possibly.
The Wall Street Journal’s Law Blog (paid subscription) asks today whether readers think Apple’s close-to-the-vest-approach or United Healthcare’s open approach is better. From an investor’s standpoint, clearly United Healthcare’s approach is better, but there are several hundred degrees of difference in magnitude between the two.
The United Healthcare executives were receiving salaries and colluding to cover up the backdating of hundreds of millions of dollars in stock options. Even if Jobs is implicated in the forging of the documents related to his relatively paltry 7.5 million options — options he was ultimately given a market value for but never actually exercised and no longer owns — it’s questionable if it’s material enough to cause him to have to step down.
Still, criminal proceedings in high-profile securities cases often turn on more than intent and the relative level of benefit (see: Stewart, Martha). Apple could become the poster child for stock option backdating prosecution and, call the Macalope cynical, but with an SEC chairman appointed by the Republican rival of a Democrat on the board of the company, it’s got to be a tempting target.