A recent flurry of insider-trading cases brought by the Securities and Exchange Commission have demonstrated that the regulator has indeed stepped up its enforcement efforts in this area. Several weeks ago, the SEC filed charges against former Oracle vice president Christopher Balkenhol. According to the Commission, Balkenhol learned about secret merger negotiations from his wife, […]
Stephen Taub
Posted inBoards & Shareholders
CVS Caremark Incident Highlights Rule 452 Issues
A controversial withhold vote campaign at CVS Caremark’s recent annual meeting has resulted in charges of ballot stuffing and renewed calls for the Securities and Exchange Commission to approve a New York Stock Exchange proposal to revamp its rule for when brokers vote for directors on behalf of certain shareholders. The incident occurred just as […]
Posted inRegulatory Enforcement
Aiding And Abetting Gets More Attention
Supporting actors can be just as vital to the success of a corporate fraud as they are to a film. So it’s no surprise that they’re attracting a lot of attention these days. Earlier this month the Securities and Exchange Commission settled aiding-and-abetting charges against a distributor for videogame maker Take Two Interactive Software for […]
Posted inRegulatory Enforcement
Appellate Victories Undermine Mail Fraud Theory
An innovative defense against mail and wire fraud that sprung three former Merrill Lynch executives from prison last year has figured prominently again in a fraud case against a former Enron executive and may end up helping defense strategies for many more white-collar crime suspects. Christopher Calger, a former vice president at Enron North America, […]
Posted inFrom the Archive
Trying The ERISA Gambit For Backdating Lawsuits
Employees at a handful of companies seeking to recover losses after their employers admitted to backdating stock option grants illegally are exploring a potentially powerful avenue: the federal ERISA statute. The Employee Retirement Income Security Act requires a laundry list of compliance obligations on companies to help protect workers’ retirement monies. It also imposes fiduciary […]
Posted inBoards & Shareholders
Dissidents Win Proxy Fight, Without Proxy
It isn’t surprising that dissident shareholders of Take Two Interactive Software seized control of the videogame maker’s board recently. When a company restates its financial results four times in five years and its former CEO pleads guilty to fraud, that sort of thing happens. What is surprising is how the investor group, led by a […]
Posted inBoards & Shareholders
Analyzing RIM’s New ‘Oversight Committee’
When Research in Motion disclosed that an internal review found a number of irregularities stemming from its stock option granting practices, the company best known for the Blackberry wireless devices announced a series of governance changes. Among them: the establishment of a new “oversight committee of the board.” The committee will be comprised exclusively of […]
Posted inBoards & Shareholders
Activists Lose Proxy-Access Fight At HP
Corporate America scored a strong victory last week in the first skirmish this year over shareholder access to the proxy statement, as activists fell far short in a vote to grant proxy access at corporate governance bellwether Hewlett-Packard. Just 39.3 percent of total shares voted (and only 29.6 percent of total shares outstanding) were cast […]
Posted inAccounting & Auditing
Management override of internal controls
Few risks are as perilous to the integrity of financial statements as a management override, and the issue of management taking a position contrary to the control environment has been a concern among regulators and accounting professionals for years.
Posted inBoards & Shareholders
The Art Of Settling Shareholder Resolutions
In one sense, insurance giant Aflac Inc. made governance history last week, with the surprise news that it will give shareholders an advisory vote on executive compensation starting in 2009—the first major company to do so. Then again, Aflac simply read the mood among shareholder activists, and ran to the popular side. Nothing new about […]
