dating a woman twenty years younger - Reyes backdating

Reyes reaped about

Reyes reaped about $1.9 million in profit from backdated options, according to both sides, although his attorney noted those options were approved by company directors.The high-profile case rocked Silicon Valley in the early part of last decade: Reyes was the most prominent local executive to be charged with criminal wrongdoing after authorities began investigating numerous local companies and their options practices.

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Reyes reaped about $1.9 million in profit from backdated options, according to both sides, although his attorney noted those options were approved by company directors.

The high-profile case rocked Silicon Valley in the early part of last decade: Reyes was the most prominent local executive to be charged with criminal wrongdoing after authorities began investigating numerous local companies and their options practices.

Wrapping up a three-week trial, a defense attorney argued to jurors Monday that prosecutors failed to prove former Brocade Communications CEO Gregory Reyes deliberately sought to mislead investors and regulators about the company’s practice of backdating employee stock options. Reyes was telling auditors and shareholders one thing and doing something quite different.” Backdating stock options to make them more valuable is not itself illegal, but companies must account for those options as a noncash expense against their earnings.

.9 million in profit from backdated options, according to both sides, although his attorney noted those options were approved by company directors.The high-profile case rocked Silicon Valley in the early part of last decade: Reyes was the most prominent local executive to be charged with criminal wrongdoing after authorities began investigating numerous local companies and their options practices.

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In short order, the company forced Reyes to resign, restated its earnings and cooperated with the federal government to avoid criminal prosecution of the company. The government introduced numerous documents, including SEC filings, in which Reyes attested that Brocade had properly accounted for all stock-option grants and kept accurate minutes and records to support its actions when, in fact, it had not.

The government also introduced an e-mail from Reyes that said, "It is illegal to backdate stock options"; testimony from a former compensation manager that Reyes once told her that "it's not illegal if you don't get caught"; and testimony from an attorney who assisted in the company's internal investigation of Reyes' denial of having ever backdated stock options and assurance that he understood the accounting implications of "in-themoney" options. Implications of the Verdict on Criminal Backdating Cases Anyone who has ever tried a criminal case knows that every trial is as unique as a snowflake.

Reyes' Indictment and Trial Among the companies swept up in the backdating frenzy was Brocade Communications, a Silicon Valley data storage networking provider. With the Department of Justice and the white-collar criminal defense bar looking on nervously, the case proceeded to trial in June.

Based on the company's own internal investigation (conducted by outside counsel), Brocade determined that backdating had occurred from 2000 to 2004. Throughout the trial, both sides seemed to focus on the critical issue of intent, i.e., whether Reyes willfully oversaw the backdating of stock options with the intent to defraud shareholders.

He was convicted of securities fraud and related charges in 2007, but his conviction was overturned on appeal.

Last modified 10-Nov-2015 23:44