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The controversy surrounding the timing of stock options grants claimed another victim on Tuesday when McAfee, the antivirus software company, fired its general counsel amid an ongoing internal probe.
McAfee said its board of directors had dismissed Kent Roberts, the company’s lead attorney, after it “became aware of one episode involving the general counsel in 2000 that was improper”.
McAfee declined to provide further details.
Mr Roberts could not be contacted at the time of going to press.
McAfee is one of several technology companies that have become embroiled in controversy amid concerns about the timing of executive options grants.
Mr Roberts’ departure marks the first time that a company’s general counsel has been sacked since news of the controversy broke in March.
The Wall Street Journal published a report that questioned whether executives at some companies might have inflated the value of executive stock options by retro-actively timing their options awards to coincide with low points in the value of their companies’ shares.
If such actions were taken without being disclosed to shareholders, it would raise serious legal and corporate governance concerns. The controversy widened last month after the Securities and Exchange Commission and the US attorney’s office in New York contacted several companies seeking information about their options granting practices.
On Tuesday, a non-profit group that sets voluntary, performance-reporting standards for the investment industry, called on the SEC to bolster proposals on improving stock option award timing disclosure.
The CFA Centre for Financial Market Integrity urged new rules requiring dates where “prior-year” compensation committee meetings were included in a company’s annual proxy statement and details of whether executives were allowed to select or recommend grant dates for their options.
Kurt Schacht, the CFA’s executive director, said: “Our proposals would enable shareholders to hold boards accountable for improper behaviour and require senior executives to attest to the accuracy of the dates companies report for granting stock option awards.”McAfee is conducting an internal review with the help of outside counsel.
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