Broadcom probe looks at ex-CEO's behavior: report
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Federal officials investigating stock-options backdating at Broadcom Corp. are looking into allegations that former Chief Executive Henry Nicholas III used hard drugs and hired prostitutes, the Wall Street Journal reported on Friday.
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Broadcom Corp. on Tuesday announced that Scott McGregor, chief of Philips&#39; chip division, will become its new president and CEO.
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A civil lawsuit accusing Henry Nicholas III, the former president and CEO of Broadcom Corp., of mistreating employees, using illegal drugs and paying for prostitutes, has reportedly caught the attention of U.S. law enforcement officials investigating stock options backdating at the company.
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(InfoWorld) - Broadcom's accounting woes have deepened as the networking chip company examined more stock-option grants that apparently were backdated. In July, Broadcom said it found irregular stock-option grants made from 2000 to 2002Â and expected to take more than $750 million in additional compensation expensesÂ because of those grants. On Friday, the company said it found other questionable stock-option grants awarded between June 1998 and May 2003. Now Broadcom expects those additional compensation expenses to be at least twice as big. The company also expanded its restatement of past financial results. It had previously expected to restate results for 2000 through the first quarter of 2006, and now it also believes its results for 1998 and 1999 will need to be restated. Broadcom is one of many high-tech companies to be hit with problems related to backdating of stock options during the heyday of the high-tech economy. In backdating, companies move the date of a stock-option grant to a time when the company's stock was worth less, in order to give the employees a greater gain when they cash in. Apple Computer Inc., Rambus Inc., McAfee Inc. and other companies are embroiled in controversy over apparent backdating. The audit committee of Broadcom's board of directors is continuing a voluntary review of the Irvine, California, company's compensation practices with the help of outside counsel, and it hasn't reached any conclusions, Broadcom said in a press release on Friday. Broadcom said it made the grants during a time when it was hard to attract the best high-tech talent and that about 95 percent of the grants went to employees other than executive officers.
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Regulators are investigating share dealing by the chief executive of Scottish dairy firm Robert Wiseman Dairies.
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U.S. Federal Trade Commission Chairman Deborah Platt Majoras is consulting with the agency's ethics officer to see if she should recuse herself from a review of Google's planned acquisition of online ad network DoubleClick.
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Federal prosecutors on Thursday identified Broadcom Corp. co-founders Henry T. Nicholas III and Henry Samueli as "unindicted potential co-conspirators" in an investigation into the illegal backdating of stock options.
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A former Hewlett-Packard Co.   board member has asked U.S. prosecutors, as well as  U.S. trade and communications regulators, to review an HP  investigation in which directors' and journalists' private  phone records were accessed.
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(InfoWorld) - Reactions to Time Warner Inc.'s decision to sack AOL LLC's chief executive officer (CEO) range from lukewarm endorsement to strident disapproval, as the industry tries to make sense of a move many observers find perplexing. Jonathan Miller, who guided AOL through a complicated transformation from an Internet has-been to a credible player, got his walking papers last Wednesday. Randy Falco, a TV industry veteran who was president and chief operating officer of the NBC Universal Television Group, will take over as AOL's chairman and CEO. "It's a strange move, because AOL is on the way up. Miller was responsible for turning around the ship successfully, so it's not clear to me why they're replacing him," says industry analyst Greg Sterling of Sterling Market Intelligence. Miller, named chairman and CEO in August 2002, had the difficult task of changing AOL's business model from one focused on dial-up Internet access subscriptions to one centered on online advertising. This involved tearing down AOL's "walled garden" and making freely available on the Web the content and services it previously reserved for paying members via its proprietary software. This leap of faith assumes AOL will make up and surpass with online advertising the revenue it will give up by abandoning its Internet access business. Early indications suggest the plan is working. Although in Time Warner's third quarter, which ended Sept. 30, AOL's revenue declined 3 percent, due to the shrinking access business, online advertising revenue increased 46 percent, faster than the industry average, which hovers between 33 percent and 37 percent. This prompted Time Warner officials and financial analysts to shower Miller and other AOL top leaders with praise. Privately, however, the recovery signs may have come too late and been underwhelming for Time Warner. At a time when an Internet startup like YouTube Inc. gets bought for $1.65 billion, Time Warner may have astronomical expectations for AOL that it didn't see Miller meeting. "Miller's accomplishment is that he transitioned AOL from a fee model to a free model, which gives AOL a future. The problem is that AOL remains a property in trouble, one that isn't performing particularly well, certainly behind Google and Yahoo. That has been the big disappointment. Today, if you have a [company with a] Web model, you're looking for a very rich return on investment," says industry analyst Rob Enderle of Enderle Group. But as it searches for bigger online ad growth with an Internet industry outsider as CEO, Time Warner risks turning AOL's recovery into a relapse. "Falco doesn't really know the business. That's going to be the problem: he's going to be learning on the job. It may not be a huge problem if he's packaging the company up for sale, but if he's going to try to run it, it's probably going to be a [long] learning experience," Enderle says. As learning goes, Miller is also credited with synchronizing AOL to varying degrees with key trends driving the rebirth of the Web economy, such as blogging, Internet search, digital music, online video and open-development platforms. Lately, he had been spurring AOL product teams to shift their philosophy from making simple yet integrated products and services to developing outstanding ones. "The emphasis today is to make stuff great," Miller said at the Web 2.0 Summit in San Francisco a week before he was dismissed. He added then that this focus is key if AOL wants to increase traffic to its Web sites, which in turn fuels its online ad business. Unlike his successor, Miller was no stranger to the Internet business when he joined AOL. He had been president and CEO of USA Interactive's USA Information and Services (USAIS), which included at the time businesses like Ticketmaster.com, Citysearch, Match.com, USA Electronic Commerce Solutions and Expedia.com. A Time Warner spokesman disputed claims that Falco is an Internet newbie, saying that at NBC he oversaw the launch of several Web sites, including one tied to the network's Olympic Games coverage , and of online initiatives, such as the joint portal for U.S. Hispanics that Yahoo and NBC's Telemundo network announced in May. Ultimately, however, Falco comes on board because of his ad sales and traditional media background. "His TV experience and advertising connections really dovetail perfectly with AOL's focus on video and advertising going forward," the spokesman said. "Randy Falco is the right person to take AOL to the next level." Falco will provide more details about what that "next level" goal is when he takes over at a yet undetermined date, according to the spokesman. Miller remains at AOL for now but will leave Time Warner at a date that also has yet to be determined, the spokesman said. At least one high-profile AOL official has decided to jump ship rather than work under Falco. Jason Calacanis, who sold his very successful Weblogs Inc. company to AOL last October and continued to run it as a stand-alone subsidiary, resigned on Friday, after writing on his blog about his disappointment over Miller's removal. Of course, there are precedents among Internet companies appointing chief executives from traditional media companies, like Terry Semel, who became Yahoo's CEO in 2001 after 24 years with Warner Bros., says James C. Goss, a media and entertainment financial analyst at Barrington Research. Whatever Falco does, it's clear his key mandate will be to leverage his experience in the TV industry to accelerate AOL's ad sales business. If he fails at that, his appointment will be seen as a major mistake. "Obviously, AOL has changed its stripes and this just seems like a reaction to the shift in its business, to have somebody as CEO who has a lot of experience in the media side and, from an organizational standpoint, with a large operation of that nature," Goss says. "This is reflective of the dramatic business model change and of the aspirations" that come with it. Be that as it may, some Internet industry observers remain befuddled. "From the outside, it doesn't seem to make any sense," Sterling says. Â ADVERTISEMENTNEW IT SERVICES FROM IBM: EASIER TO BUY AND IMPLEMENTDiscover a simpler, more cost-effective way to get the solutions your company needs to grow more flexible and efficient.
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Semiconductor maker Broadcom Corp., whose chips are used in cell phones and Apple's iPod, said fourth-quarter profits plunged 76 percent on charges related to how it previously accounted for stock options grants.
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Broadcom has named Scott McGregor, the former head of Royal Philips Electronics&#39; semiconductor division, chief executive of the company.
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Microchip maker Broadcom Corp.   said on Friday it found more discrepancies in the  dates of past stock-option grants, and expects to record  additional expenses at least double its previous estimate.
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SAN FRANCISCO, June 18 -- Gregory L. Reyes, the former chief executive of Brocade Communications Systems, either masterminded a stock-option backdating scheme designed to defraud investors or fell victim to murky accounting laws and heightened public scrutiny of corporate accounting errors, lawyers...
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Federal prosecutors are strongly  considering criminal charges against former executives of  Broadcom Corp., Apple Inc., and KLA-Tencor Corp., related to  the backdating of stock options, the Wall Street Journal  reported on Friday, citing people familiar with the situation.
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The law firm of Milberg Weiss announced today that it is investigating possible illegal conduct relating to 401(k) retirement plans at computer maker Dell Inc. Specifically, Milberg Weiss is investigating whether fiduciaries of the Dell Inc.
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By The Orange County Register, Calif.  Dec. 19--Chipmaker Broadcom Corp. said it canceled more than $37 million  in stock options for three former employees after finding that they adjusted  the dates of the options to maximize their value.
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New York Attorney General Andrew Cuomo is investigating possible violations of state and federal antitrust laws by Intel Corp., the world's largest manufacturer of computer microprocessors.