Several more top executives have lost their jobs over the options backdating scandal.
Officials at McAfee Inc. announced that the company fired president Kevin Weiss, and that chairman and chief executive officer George Samenuk has retired after a special committee determined it will need to restate 10 years worth of financial statements to record additional non-cash charges for stock-based compensation expense. “I regret that some of the stock option problems identified by the special committee occurred on my watch,” said Samenuk, in a statement.
In addition, CNET Networks Wednesday morning announced that co-founder and chief executive officer Shelby Bonnie has resigned as chairman and CEO. The press release was issued one minute after the company announced that a special committee concluded “there were deficiencies with the process by which options were granted” at CNET, including in some instances the backdating of option grants, during the period from the company’s IPO in 1996 through at least 2003.
The company added that these deficiencies resulted in accounting errors, which the company has previously announced will result in a restatement. It also noted that a number of executives, including Bonnie, the former CFO, and the recently resigned general counsel and senior vice president of human resources, “bear varying degrees of responsibility for these deficiencies.”
In a statement, CNET’s Bonnie stated: “I apologize for the option-related problems that happened under my leadership. I believe that the company has come a long way since 2003 in addressing these deficiencies, but am deeply disappointed it happened nonetheless.”
The resignations and firings at McAfee and CNET come on the on the heels of several other high-profile executives who have lost their jobs amid internal stock option probes, moving some observers to predict that this could be the beginning of the next phase of the stock option scandal.
In its announcement, McAfee also said that based on a preliminary review, it will need to restate prior results to record charges in the range of $100 million to $150 million. McAfee added that it will review recent guidance from the Securities and Exchange Commission’s Office of the Chief Accountant and will determine, subject to final review by its independent auditors, the exact amount of such charges, the resulting tax and accounting impact, and which specific prior periods require restatement.
