United health backdating

05-Jul-2017 19:13

The company also took significant remedial actions in response to the findings of its internal investigation, including the implementation of new controls designed to prevent the recurrence of fraudulent conduct, removal of certain senior executives and board members, and the recoupment of nearly

The company also took significant remedial actions in response to the findings of its internal investigation, including the implementation of new controls designed to prevent the recurrence of fraudulent conduct, removal of certain senior executives and board members, and the recoupment of nearly $1.8 billion in cash, options value and other benefits from several former and current officers, through, among other things, derivative litigation and the voluntary re-pricing and cancellation of retroactively-priced options.“The Commission has filed fraud charges against United Health’s former CEO and General Counsel for their roles in the options backdating scheme, and today’s complaint against the company details the seriousness of United Health’s misconduct,” said Fredric D.

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The company also took significant remedial actions in response to the findings of its internal investigation, including the implementation of new controls designed to prevent the recurrence of fraudulent conduct, removal of certain senior executives and board members, and the recoupment of nearly $1.8 billion in cash, options value and other benefits from several former and current officers, through, among other things, derivative litigation and the voluntary re-pricing and cancellation of retroactively-priced options.

“The Commission has filed fraud charges against United Health’s former CEO and General Counsel for their roles in the options backdating scheme, and today’s complaint against the company details the seriousness of United Health’s misconduct,” said Fredric D.

The Complaint alleges that defendants violated federal securities laws by issuing a series of materially false statements. United Health represented that the exercise price of all stock options would be no less than the fair market value of United Health's common stock, measured by the publicly traded closing price for United Health stock on the day of the grant.

Specifically, defendants misrepresented and omitted material facts concerning United Health's backdating of stock option grants to defendants William W. However, in reality, those options were backdated so their exercise price correlated to a day on or near the day United Health stock hit its low price for the year, or directly in advance of sharp increases in the price of United Health stock.

.8 billion in cash, options value and other benefits from several former and current officers, through, among other things, derivative litigation and the voluntary re-pricing and cancellation of retroactively-priced options.“The Commission has filed fraud charges against United Health’s former CEO and General Counsel for their roles in the options backdating scheme, and today’s complaint against the company details the seriousness of United Health’s misconduct,” said Fredric D.

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United Health’s cooperation included an independent internal investigation, the company’s release in a Form 8-K of a report detailing the investigation’s findings and conclusions, and the sharing of the facts uncovered in the internal investigation with the government.

Linda Chatman Thomsen, Director of the SEC’s Division of Enforcement, said, “United Health engaged in a long-running scheme to hide over a billion dollars in executive compensation.

By materially misstating these expenses for over a decade, United Health breached its duty to shareholders to accurately report its financial results.” According to the Commission’s complaint, certain United Health officers used hindsight to pick advantageous grant dates for the company’s nonqualified stock options that on many occasions coincided with, or were close to, dates of historically low annual and quarterly closing prices for United Health’s common stock.

According to the Stipulation, the various derivative lawsuits "were a material factor in obtaining the million payment from Apple’s liability insurers." The total cash value of the various payments is .85 million.

UPDATE: An alert reader has raised an important question about my statement that the total cash value of this settlement is .85 million.

United Health’s cooperation included an independent internal investigation, the company’s release in a Form 8-K of a report detailing the investigation’s findings and conclusions, and the sharing of the facts uncovered in the internal investigation with the government.

Linda Chatman Thomsen, Director of the SEC’s Division of Enforcement, said, “United Health engaged in a long-running scheme to hide over a billion dollars in executive compensation.

By materially misstating these expenses for over a decade, United Health breached its duty to shareholders to accurately report its financial results.” According to the Commission’s complaint, certain United Health officers used hindsight to pick advantageous grant dates for the company’s nonqualified stock options that on many occasions coincided with, or were close to, dates of historically low annual and quarterly closing prices for United Health’s common stock.

According to the Stipulation, the various derivative lawsuits "were a material factor in obtaining the million payment from Apple’s liability insurers." The total cash value of the various payments is .85 million.

UPDATE: An alert reader has raised an important question about my statement that the total cash value of this settlement is .85 million.

Lubben consented to the entry of an order permanently enjoining him from violating or aiding and abetting violations of the antifraud, reporting, record-keeping, internal controls, proxy statement, and securities ownership reporting provisions of the federal securities laws, and barring him from serving as an officer or director of a public company for a period of five years.