November 24, 2006
How Bad Was the Options Back-Dating at Monster?
Options back-dating investigations have ensnared over 125 companies so far, and it looks like things are coming to a head at on-line job search company Monster Worldwide, Inc., when it announced the termination of its general counsel for cause. The company issued a press release (here) on Wednesday, November 22, stating that "the Company’s Board of Directors has terminated Myron Olesnyckyj, the Company’s former Senior Vice President, General Counsel and Secretary, for cause. Mr. Olesnyckyj was suspended from his position on September 19, 2006. The Board’s action was taken with the concurrence of the Special Committee of independent directors reviewing the Company’s historical stock option grant practices." As discussed in an earlier post (here), Monster's former CEO, Andrew McKelvey, resigned from the board of directors after his lawyer decided not to allow him to meet with the law firm conducting the internal investigation of the timing of options grants. McKelvey's lawyer said that the meeting could not take place because he was recently hired and not prepared to have his client meet, but the firing of Olesnyckyj may well indicate that back-dating of options might not have been a result of negligence or a misunderstanding of the issuance process. The U.S. Attorney's Office for the Southern District of New York subpoenaed the company back in June for documents related to its options practices, and this office hasn't gotten into the game yet with an indictment, unlike the U.S. Attorneys in San Francisco and Brooklyn. Prosecutors in Manhattan are sure to take a close look at the results of Monster's internal investigation. (ph)
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