UnitedHealth's Stock-Option Practices Under Formal Investigation
UnitedHealth Group, the country's second-largest health insurer behind WellPoint, said that federal regulators have begun a formal investigation into its historical stock-options practices.
The Securities and Exchange Commission's formal order follows an informal inquiry begun in April. UnitedHealth said in SEC filing it intends to cooperate with the investigation.
The company's own internal review found errors in its stock options accounting that will cost some $400 million to $1.7 billion to correct. UnitedHealth has said it will have to restate its earnings back to 1994. The scandal forced out former Chairman and CEO William McGuire.
"This is a routine step in the process, and the company continues to cooperate fully with the SEC," said UnitedHealth spokesman Don Nathan.