Report: Apple ‘falsified’ records on 7.5m stock options granted to CEO Steve Jobs in 2001

“Steve Jobs, chief executive of Apple Computer, was handed 7.5m stock options in 2001 without the required authorisation from the company’s board of directors, according to people familiar with the matter,” Richard Waters reports for The Financial Times.

Waters reports, “Records that purported to show a full board meeting had taken place to approve Mr Jobs’ remuneration, as required by Apple’s procedures, were later falsified. These are now among the pieces of evidence being weighed by the Securities and Exchange Commission as it decides whether to pursue a case against the company or any individuals over the affair, according to these people.”

“According to an Apple filing in 2002, the options under review were handed to Mr Jobs in October 2001, at an exercise price of $18.30 a share. However, the purported board authorisation was dated near the end of the year, suggesting that the benefits were both not properly authorised and were backdated. Mr Jobs later surrendered his options before they were exercised, implying that he did not gain any direct benefit from them. He was later given a grant of restricted stock by the company instead,” Waters reports.

Full article here.

Related articles:
What would Apple be worth without Steve Jobs? – December 27, 2006
Piper Jaffray: Steve Jobs not at risk in stock options case – December 27, 2006
Apple shares push into positive territory, top NASDAQ most-active list – December 27, 2006
Shares of Apple Computer fall 5% in pre-market trading – December 27, 2006
Faked documents may be at core of Apple options probe; Jobs seeks outside legal representation – December 26, 2006
Apple delays filing annual report due to ongoing stock options investigation – December 15, 2006
Options scandal: is Apple’s Steve Jobs truly safe? – October 18, 2006
Apple Computer Directors may have had conflicts of interest in options investigation – October 11, 2006
Apple’s options disclosures leave plenty of unanswered questions – October 09, 2006
Apple shareholders await earnings restatements; Steve Jobs still not in the clear – October 06, 2006
Former CFO Anderson helped turn Apple Computer around – October 05, 2006
Wall Street unshaken by results of Apple stock options investigation – October 05, 2006
Is Apple rotten at the core? – October 05, 2006
Analyst: Anderson, Heinen may be former Apple executives responsible for irregular options grants – October 05, 2006
Analyst: Apple restatement due to options irregularities not expected to be significant – October 04, 2006
Apple’s special committee reports findings of stock option investigation – October 04, 2006
Google CEO declines Apple automatic stock option grant; plans to buy 10,000 AAPL shares instead – September 01, 2006
Google CEO Dr. Eric Schmidt joins Apple’s Board of Directors – August 29, 2006
Shareholders allege Apple execs reaped ‘millions’ in unlawful profits – August 23, 2006
How options-backdating irregularities can affect your Apple Computer stock – August 23, 2006
Apple’s options imbroglio: Mac-maker granted options at or near key events in company’s history – August 18, 2006
Apple added to Nasdaq’s list of ‘delinquent companies’ – August 18, 2006
Apple unlikely to be delisted by NASDAQ – August 16, 2006
Apple CEO Steve Jobs drawn into stock options scandal – August 15, 2006
Apple announces update regarding stock option grants – August 11, 2006
As expected, Apple delays quarterly results due to stock-options grants review – August 11, 2006
Some stock options grant decisions were made by Apple board, and potentially, CEO Steve Jobs – August 10, 2006
Disney: no material impact from Pixar options – August 09, 2006
Pixar options draw scrutiny – August 08, 2006
Apple stock options scandal? What scandal? – August 07, 2006
Class action lawsuit over stock options filed against Apple Computer, Inc. – August 04, 2006
Wall Street forgiving of Apple’s stock option irregularities; CEO Jobs unlikely to be terminated – August 04, 2006
Apple’s stock option irregularities escalate into a scandal as world awaits Steve Jobs’ WWDC keynote – August 04, 2006
Apple warns of profit restatement dating back to 2002 – August 04, 2006
Apple loses 3.5% to $67.15 in premarket trading – August 04, 2006
Apple announces update regarding stock option grants – August 03, 2006
Shareholder’s options suit against Apple alleges ‘striking pattern that could not have been chance’ – July 11, 2006
Apple announces update regarding stock option grants – July 05, 2006
UBS: stock options probe unlikely to hurt Apple – June 30, 2006
Apple joins growing list of companies entangled in stock option ‘irregularities’ – June 29, 2006
Apple to investigate stock option grant ‘irregularities’ made between 1997 and 2001 – June 29, 2006

58 Comments

  1. They [the powers that be at Apple] go through the trouble of falsifying that a full board meeting had approved these options, yet Steve never exercised them. Did he know, and then feel it was too risky to go through with it? Not sure. In any event, he never did exercise them, so that’s a major plus to him. Still, there could be some type of reprocussions if he was directly involved with the whole scheme. No, he didn’t profit from it, but that fact that he was even granted them in the first place is now suspect.

  2. Whatever the reasons were at the time, it’s a good thing Steve Jobs surrendered the options in exchange for the restricted shares, without ever exercising them. At the time, I think the options were “underwater” but if he had kept them, they would be worth much more now than the restricted shares. But it would have looked bad if he had personally gained from the transaction under investigation.

  3. As long as Jobs stays with Apple I’m happy. Could not care less about the price of shares as I don’t own any and Apple will continue to make excellent products regardless of the share price.

  4. Eric,

    Tell that to all the Enron stockholders and employees. Kenneth Lay, Jeffrey Skillings didn’t really do anything either.

    Skillings is serving 24 years 4 months for the record.

    BTW AAPL is down $2.47 in after hours trading. Between this and the stock restatement on Friday AAPL is going to take a huge hit.

    Hold on, it’s about to get ugly……….real ugly.

  5. Steve,

    I’m not comparing Enron to Apple. The point I was trying to make was that if the allegations against Steve Jobs are true then he’s no better than Kenneth Lay or Jeffrey Skillings. Sorry that you didn’t get my previous post.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.