KB Home CEO resigns after backdating probe
SAN FRANCISCO (MarketWatch) -- KB Home CEO, President and Chairman Bruce Karatz has resigned after an internal investigation found that he backdated his own stock-option grants to increase his pay and will forfeit about $13 million in gains from the backdating, according to a media report Sunday
KB Home also said it has created the new post of non-executive chairman and will conduct a search for the position, The Journal reported.
KB Home disclosed in August it was conducting an internal probe of its options grants, after being contacted by The Wall Street Journal about an unusual pattern of well-timed grants.
The company said it hasn't negotiated any terms of departure with Karatz other than the agreement to repay profits from backdating, The Journal said.
To correct its accounting for the backdating, KB Home said it expected to take charges of no more than $50 million, according to The Journal.
At they still have not filed their 10k. Trouble ahead??
Sunday, November 12, 2006
CEO Resigns
Subscribe to:
Post Comments (Atom)
8 comments:
This is clearly securties fraud. I hope he does hard time.
The class action lawsuits will add to KB Homes coming pain!
crispy&cole
Let the perp walks begin!
Big story. Karatz is a huge name in the REIC. They are probably going to replace him with 3-4 individuals, for the 3 hats he wore and the one new post they announced. Options backdating is just the camel getting its nose in the KB tent. I'll bet there's a lot of shady business. Even if it's on the up-and-up, they have a lot of crapboxes sitting empty going into the correction.
I think Karatz will follow the model of Kozlowski at Tyco. I figure he and the board hope that this move is a good escape hatch, but I think he's in for some serious shareholder/creditor/regulator legal action.
well crap, now maybe this will draw some attention to the slightly more subtle stock buyback scams that are so rampant in the industry.
Cripes, I'm begining to get a swelled head. What gets me is that he gives the money back and resigns. The company hasn't "negotiated" the terms of his leaving? I suggest: "The nice security gaurd will escort you to sidewalk where we've called you a cab. Your lawyer can contact the FEds as to if and when anything deemed to be personal property and not evidence can be reclaimed. We'll discuss how much you'll pay back above and beyond the disgorgement and fines to compensate the shareholders for loss of credibility. In recognition of your years of service we promise to try and visit every third Sunday if premitted."
Robert-
When does "you know who" get cuffed?? Get me hope that it is soon!
crispy&cole
Crispy&Cole,
Did the big subdivision out by Mesa Marin Raceway ever get going?
Full steam ahead. I think it is a developer from your area. One developer in that area is already going into foreclosure.
crispy&cole
Post a Comment