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Former KB Home CEO Indicted on Fraud Charges

AP
Thursday, 5 Mar 2009 | 5:45 PM ET

The U.S. attorney's office says the former chairman and CEO of KB Home has been named in an indictment charging him with conspiring to defraud the homebuilder and shareholders through a stock option backdating scheme.

The U.S. attorney for the Central District of California said Thursday Bruce Karatz faces several counts of mail, wire and securities fraud and making false statements in reports filed with securities regulators.

Prosecutors also accuse Karatz of concealing the scheme to inflate the value of his stock options from an internal investigation.

Karatz stepped down in 2006 after it was disclosed that he benefited from favorably dated stock option awards.

He settled civil charges of backdating stock options in September.

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