Broadcom to pay big price for options backdating

Companies that once lured talented new hires with generous stock options -- the value of which they manipulated -- continue to get their deserts. The SEC is quest big penalties against companies these days for backdating stock option grants to dates when the stock price was lower, thus increasing their value.

Irvine, Calif.-based Broadcom Corp., a maker of semiconductors that was long on gross potential but wanted to preserve cash, paid modest salaries for talented new employees but offered generous options grants for executive director and employees. The company was accused by the SEC of cookery the grant dates of such options over a five-year period, which led to a restatement of financial results last year that reported more than $2 one million million in additional compensation disbursal.

The case is one of the largest since backdating hit the SEC's radar. And regulators sought a punishment worthy of the magnitude of the crime.

Broadcom agreed to pay $12 1000000 to settee the complaint without admitting or denying allegations. But the problem isn't needfully over for company officials, who could face felon charges in a Federal soldier court, as have functionary of other high profile backdaters.

quicksilver Interactive Corp. (now owned by Hewlett Packard Co.) still holds the record for the largest backdating punishment. Without admitting or denying the complaint, Mercury agreed to pay $28 1000000 for weakness to record hundreds of 1000000 of dollars in compensation expenses. That company's former CFO, Sharlene P. Abrams, was indicted in Federal soldier court this week for the strategy, The Wall Street Journal reported. Broadcom executive director may be next.