|  | | 2006 News and Press Releases | | |
HEADLINE NEWS:
U.S. Attorney : On The Record Kevin Ryan
Staff Writer
San Francisco Chronicle. December 24, 2006
_________________________________________________________________________
EXCERPT: Kevin Ryan, the tough-talking point man for the Bush administration's federal law enforcement efforts in Northern California, has taken a high-profile interest in investigating whether Bay Area companies and executives fraudulently backdated stock-option grants. Over the summer, the U.S. attorney for the Northern District of California dedicated a federal task force of prosecutors and investigators to the financial scandal that has swept up dozens of companies, led to two criminal indictments and prompted a rash of executive resignations. Ryan's office is investigating more than 25 companies. About 15 to 20 percent have troubling red flags, he says. These investigations could go on for years, although sources in federal law enforcement suggest another indictment is imminent. To add more investigative firepower, Ryan is also focusing on whether employees who received the backdated options lied on their individual tax returns. …
Q: What are those red flags? A: If a company comes in, then fires its CEO and head of HR and says, "We have a problem and we are about to restate 300, 400, 500 million dollars," those are all red flags. Often times these cases come to us in a variety of forms. We can get a whistle-blower coming to us. We can get an insider coming to us. We can get a phone call. We created years ago the first 800 number for securities fraud. If you thought something squirrelly was going on in the company, call the 800 number and let us know. So we do have a universe of cases -- 150, 180 -- that the SEC is looking at. Then we start parsing that down into our district. How many of these cases are in our district. We start reading the newspaper to see who is restating, who is refiling their 8-Ks, their 10-Ks, their 10-Qs. Who got laid off? And why? And what is the story there? That has an impact on us. We will start looking at companies because of that kind of conduct. And we will start prioritizing and reprioritizing. And often times we will already know or have a sense of what's going on. Q: As companies conduct these self-investigations, are they reporting to you and the SEC their findings? A: Yes, they are. They make presentations to us. They come in and tell us what the review process found. Sometimes that can shed light, sometimes it cannot shed any light at all. |
|
|
