Thursday, May 8, 2008
The SEC settled charges against Marvell Technology Group, Ltd., a Silicon Valley semiconductor company, and its co-founder for improperly backdating stock option grants to employees. The agency alleged that Marvell provided potentially lucrative "in-the-money" options to employees, backdated the options to dates with lower stock prices, and falsely represented that the options had been granted "at-the-money" on earlier dates. According to the SEC's complaint, filed in federal district court in San Jose, the scheme allowed Marvell to overstate its income by $362 million from its fiscal years 2000 through 2006.
Marvell and former operating officer Dai settled the SEC's charges without admitting or denying the allegations and will pay financial penalties of $10 million and $500,000, respectively.