Altera Says SEC Ends Investigation Into Stock-Option Practices
Altera said the Securities and Exchange Commission has ended its investigation of stock-options granting practices and has recommended no enforcement action.
In October, the computer-chip maker announced Chief Financial Officer Nathan Sarkisian left the company after a review of its options-granting practices pinpointed problems. The company also had to restate its earnings to reflect $47.6 million in costs pertaining to options grants.
Numerous companies have been caught up in a scandal over the alledged manipulation, or "backdating" of executive stock options. Backdating is when firms don't disclose they gave executives the right to buy shares at a price lower than the market value when the options are issued.
Options typically give executives the right to buy stock in the future at the price it was trading at when the options were issued. But recent investigations have shown companies may have abused the rules by giving executives the right to buy stock based on a lower price on a previous date.