Apple corporation stock option backdating scandal
The SEC charges are the first in the months-long Apple investigation.
Jobs was interviewed by the SEC and federal prosecutors in San Francisco, but no charges have been filed against him.
Stock option backdating has erupted into a major corporate scandal, involving potentially hundreds of publicly-held companies, and may even ensnare Apple's icon, Steve Jobs.
While the focus of the Securities and Exchange Commission ("SEC") centers on improper accounting practices and disclosures, thereby violating securities laws, a major yet little explored consequence to the scandal involves potentially onerous taxes on those who received these options.
Jobs decided to employ alternative methods to treat his pancreatic cancer, hoping to avoid the operation through a special diet—a course of action that hasn't been disclosed until now.
Thus, the option becomes "in the money", meaning there was a built-in profit on the underlying stock, on the grant date.
In October 2003, as the computer world buzzed about what cool new gadget he would introduce next, Apple CEO Steve Jobs—then presiding over the most dramatic corporate turnaround in the history of Silicon Valley—found himself confronting a life-and-death decision.
During a routine abdominal scan, doctors had discovered a tumor growing in his pancreas.
Jobs, after all, was widely viewed as Apple's irreplaceable leader, personally responsible for everything from the creation of the i Pod to the selection of the chef in the company cafeteria.
News of his illness, especially with an uncertain outcome, would surely send the company's stock reeling.