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A worm in the Apple?

Janet Babin Dec 27, 2006

TEXT OF STORY

MARK AUSTIN THOMAS: Apple Computer may be at the pinnacle of success. It’s reaped record profits in recent years thanks to the ubiquitous iPod and iTunes store. But the company’s fate could turn on the mishandling of stock options. A published report says the company falsified documents in connection with the granting of those options. Janet Babin reports from the Marketplace Innovations Desk at North Carolina Public Radio.


JANET BABIN: The article appeared in the Recorder, a San Francisco based legal daily.

Reporter Justin Scheck says federal prosecutors are looking into whether Apple officials faked stock option administration documents to get the most profit out of them.

Scheck says it’s one thing for a company to have late filings or sloppy paperwork concerning stock options . . .

JUSTIN SCHECK: But if there’s falsified documents and evidence of intentional alteration of paperwork, that could indicate intent to defraud, which would bring this into the criminal realm.

Scheck’s report names two top Apple officials who are connected with the stock options irregularities.

Additionally, Apple’s CEO, icon Steve Jobs, has hired his own personal counsel to deal with the Justice Department inquiry.

The company has not commented on the Recorder article. It could make additional comments on the stock options investigation in a public filing due Friday.

I’m Janet Babin for Marketplace.

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