Apple faked files in Steve Jobs stock options scandal
By Peter Rojas 
posted Dec 28th 2006 1:27PM
posted Dec 28th 2006 1:27PM
It seems that the scandal related to Apple backdating stock options has gotten a little more serious. According to the Financial Times, in 2001 Steve Jobs was granted 7.5 million stock options without the proper authorization of Apple's board of directors, and it now appears that someone falsified board meeting records to make it look as if Jobs had received authorization for the grant. The Securities and Exchange Commission is weighing whether to take action against Apple and/or any of the individuals involved, though whether Jobs himself might potentially be in any legal hot water is unclear. Jobs returned all granted options to Apple before exercising them, which perhaps explains why the company issued a statement in October saying that an internal investigation had cleared him of any wrongdoing (the company did force a former CFO from its board). Whether the SEC decides to go after Apple, Jobs or anyone else at the company remains to be seen, but the FT notes that plenty of other CEOs have resigned in the wake of similar backdating scandals. You could argue that given how well Apple's stock has done over the past year that even shareholders who feel cheated by what happened would rather own stock in a company helmed by Jobs than one without him, but rules are rules and if turns out that anyone at Apple broke the law it's unlikely that the Feds will go easy on them. [Thanks, nightryder21 and todd]
I read about this yesterday, this is not the first time Jobs pulls a thing like this: yesterday's news: "Gov't probe: Apple 'falsified' documents on Steve Jobs' options" at http://blog.americasnewstoday.com/2006/12/27/govt-probe-apple-falsified-documents-on-steve-jobs-options-two.aspx
and prior that: "Apple Co-Founder Speaks Out; Steve Wozniak Stiffed by Best Friend Steve Jobs" at http://blog.americasnewstoday.com/2006/10/03/apple-cofounder-speaks-out-steve-wozniak-stiffed-by-best-friend-steve-jobs.aspx
Mmm.. I think the pro-apple people are missing one important part of the story - the fact that someone has allegedly altered documents to make it look like this didn't happen.
The bank transaction error analogy is flawed because this aspect isn't included: it would be more like going to the ATM, withdrawing $20, but actually getting $20M, then finding a way to edit the audit trail so the bank can't prove you did it - and getting caught.
Similarly, it's entirely possible someone else at Apple did the fiddling all on their own - but it's hard to see who would do it - there aren't too many people who would benefit directly or indirectly from such a risk, other than Jobs, and who would have access to records to do the deed - especially since it's kind of illegal and could land the person in jail.
On the flip side, it's hard to imagine Jobs being this stupid - so that's a strike against the idea - but then again, we've seen stupider things done by smarter people... so.
In the end, the best position to take is: something had happened that smells - but until the investigation is over, it's probably best not to point fingers - or deny that something has happened.
Both POVs are pointless.
Not sure if anyone commented on this already. Could this be why the WWDC keynote had multiple speakers? To see which one would be the best replacement, if Jobs were to leave the company under the hot water.
Not sure if anyone already said something like this, but could this be why there were multiple speakers at WWDC 06? To find the best replacement, if Jobs were to leave due to the stock options scandal.
It's my understanding that because he did not exercise the options that this whole thing is moot. History shows that ceos with this type of past tend to be slapped on the wrist and nothing more. I have been reading up on the subject at http://www.businessbookreviews.com
They provide cliff notes versions of books and research data so you can move through subject pretty quick.
oops... that was http://www.businessbookreview.com
Sorry
I can hear a million fanboys getting ready to cry.
Apple = Microsoft = HP. Just more corporate BS. No one is above the fray.
Power tends to corrupt; absolute power corrupts absolutely. Lord Acton.
the weird thing is: jobs never asked for these ridiculous perks he got. sure he needs to be compensated as hell - he's the only reason the company is where it is today. unlike other CEOs, no-one else could do his job.
gotta say it: great time to buy AAPL. Oh freaks, I am too late it's already back up 5%. Darn!!!
Cool - iFraud !
iWMDs
"And it's news because of the way both Apple and Steve Jobs have marketed themselves as something different than the great, evil Micro$oft.
Maybe not quite so much as they'd have you believe."
What way is that Rob? Except for commercials 26 years ago, how has "...both Apple and Steve Jobs... marketed themselves as something different than the great, evil Micro$oft"? Wondering what "marketing" you are seeing and suspecting it is simply your fanboy angrrrr.
I was part of a team that sent another team to ask Gates (and Microsoft) to support Momenta's new pen tablet computer. The result of that meeting was PenWindows and theft of Momenta's intellectual property. We tried to sue, but were immediately overwhelmed by Microsoft's legal team (flooding us with "discovery" requests and many more boring and hurtful tactics). Momenta went quietly into that good night with more than a few of us fantasizing about setting Gates and Microsoft on fire and roasting marshmallows over his/their blazing carcasses. Being the non-psychotic non-killers we are that fantasy never materialized.
Since I've had more dealings with Microsoft, and even more experiences with Apple. Not all Microsoft workers are evil, as a matter-of-fact some are quite good folk. I've had "moments" with Apple that weren't all wine and roses, but I think most seasoned employees of Microsoft would admit that there is a very "bottom-line" kind of thinking in Redmond that often leads to less-than-altruistic decision-making. Ironically, there is very little "evil Microsoft" chat or (from what I've seen) thinking at Apple. Point being? The often cited, supposed hatred or disdain for Microsoft by Apple simply doesn't exist, but the opposite is true among certain Microsoft folk... you know the ones... they often extol the benefits of using Windows over Unix in almost every circumstance. There is a very palpable disdain that oozes out of the pocket protectors of more than a few coders 'n their ilk that is very often directed towards their fellow Microsoftians (who code for the Mac).
Apart from that little bit of Hatfield and Mac-coys, there is a GREAT deal more trust when asking for support for a new product at Apple. My fellow entrepreneurs are VERY careful about what we reveal in the halls at Redmond. Apple is well-known for being either: trustworthy in this regard, or willing to pony up big bucks for whatever it is they would like to acquire, and at Apple "no" means "no". Apple sends geeks to ask questions or permission to take a peek, Microsoft sends *lawyers* and lots of 'em. I know about that which I speak, and big time.
At any rate, concerning your comments about how Apple has "marketed themselves as something different than the great, evil Micro$oft", I don't think I've ever heard them doing this about *stock options* for crying out loud! Something different is about *user friendliness* and *human engineering*, not boardroom fiscal policy. WTF? I think 'ole Robbie V. has been sippin' the corn liquor and feeding his psychosis. Being different is about not stealing your company out from under you with a smile on your face.
There is one bit of glee I find in all of this; it wasn't too long ago that "little Apple" would have never raised the ire of folks like Robbie baby 'n crew. Things are just a little *different* now, as Apple (and the Steve) are serious business and their influence is no longer something that Microsofters can feign ignorance about. "What? That's absurd! This graphical user interface leapt right outta good 'ole Bill's head, or from Xerox... I can't remember..." I think things are just a litttttle bit too "fruity" out there for folks who like to go computer-spelunking for naughty .dll files every fortnight. Hee hee.
Just keep repeating to yourself... "Sony is gonna buy 'em soon, and then I can buy an iPod... dammit." Or... "Who needs a computer that runs three operating systems outta the box?!" (a variant of "Who needs a mouse?" or "Who doesn't need a "C" prompt?")
Don't worry Mike V, or Rob V... wait... are ya'll brothers? Uh, anyway... don't worry fellas, there’s a game coming out for the Wii that lets you run Apple Computer yourself, and it even has a "disaster mode" where you can make the Steve embezzle funds and get tossed in the calaboose! You use the controller and nunchuck to fend off the inmates bribed by PC heads to molest our Pixar hero. A feature I know you two "V"s will like is the mini-game that simulates a real Macintosh! That way you can finally use one without really "using" one, and then when you pretend to be a former Mac user that "switched" to PC... it will ring with waaay more authenticity than it does now. It has a coupon for a free iPod Shuffle... that’s the one that doesn't have a display! That way you can keep right on jamming to those fav Debbie Gibson tunes without anyone the wiser. Won't that "V" great?
I'm sick of these guys getting away with theft and fraud. I want to see some of these jerks on the side of the highway picking up trash.
No one backdated my worthless stock options of put the money back into my 401K from 2001's market meltdown.
SEND THEM TO JAIL!
It's interesting to me that I neither said Apple was bad, nor that Microsoft is good, in order to be declared a fanboy. Or that such completely irrelevant information as the initial of my last name could be said to have any bearing on what I did, in fact, say.
"What way is that Rob? Except for commercials 26 years ago, how has "...both Apple and Steve Jobs... marketed themselves as something different than the great, evil Micro$oft"?"
So that funny little marketing campaign going on right now, the artsy, fun-loving guy vs the stodgy, uptight geek, that's supposed to make them look alike? I doubt there's anything out there to suggest that Steve Jobs didn't approve that.
It's a marketing image Apple has *always* used in its competition with Microsoft. And still does. And this little scandal, whether Steve Jobs is personally responsible or not, makes it clear that this distinction isn't quite so much so as Apple wants us to believe.
Once again a Windoze fanboy pretends that what he says, is what Apple is saying, and tosses up a "strawman fallacy". Lets look at it *logically*, mmmm k? You said:
"And it's news because of the way both Apple and Steve Jobs have marketed themselves as something different than the great, evil Micro$oft.
Maybe not quite so much as they'd have you believe."
Notice that you said that they "have marketed themselves as something different than the great, *EVIL* Micro$oft"... see that *great, evil* part, Skippy? It's that *evil* part that MODIFIES your statement.
Now, had you said that "Apple has marketed the Macintosh operating system as something different than Microsoft's Windows", I would have had nothing to say *about that*. But when you talk about *fiscal policy* and you say that Apple is saying (in their ads) that they are different than “the great, evil Microsoft”… well, then Houston, we have a problem… a BIG one.
Philosophy and logic lesson… free.
Chance that fanboy learned anything… priceless.
Probability that fanboy did learn something… impossible.