KB Home is joining what's becoming a long list of companies caught up in the stock back dating issue. The home builder announced that it's under formal investigationby the SEC for improper stock option practices. The company CEO Bruce Karatz resigned (or retired) last fall over the backdating issue.
Right now--more than two hundred companies are under a similar microscope (including computer giant Apple). So--are the current regulations failing the system? Are tougher laws needed? Eleanor Bloxham is founder and president of the Value Alliance. She'd like more regulations in place. Howard Meyers, partner at Meyers and Heim and a professor at New York Law School takes a different approach (he's also a former SEC enforcement attorney). Both were on "Morning Call."
Bloxham says the recent probes show the benefits of Sarbanes-Oxley and that it also sheds a new light on internal control processes--especially compensation. She says it's important to look at a company's exec comp as much as it is to focus on a firm's financial numbers.