Read The Recorder‘s roundup of the stock-option backdating scandal. There won’t be a test later … but there might be a subpoena.
Reached Tuesday, Steskal wouldn’t comment on any options probes, including McAfee, nor would the spokesman for the office.
After assigning another prosecutor to the case, the office continued its investigation of Roberts, and earlier this month they seemed ready to charge Roberts.
It’s unclear exactly why the SEC isn’t ready. Kathleen Bisaccia, the former enforcement chief for the agency’s San Francisco office � and now a private investigator at Kroll � said several aspects of joint investigations can lead to delays.
For example, she said, the SEC can’t file charges without a vote by its commissioners, and that can take time.
But, Bisaccia added, it’s not always the SEC that is lagging. “The usual scenario is the other way around,” she said, with prosecutors being forced to ask the SEC to wait for them.
So far, the only options backdating case to move through the courts has been the prosecution of two former Brocade Communications executives. And the fireworks there have been a direct result of the SEC-DOJ coordination.
In that case, San Francisco federal Judge Charles Breyer has refused to take the common step of staying the SEC civil case until the criminal prosecution is done. That created a frazzle of legal issues straddling both proceedings, including a recent blowup over witnesses who gave testimony to the SEC and prosecutors under a temporary immunity agreement but, when subpoenaed by defense lawyers, invoked the Fifth Amendment.
Richard Marmaro, the Skadden, Arps, Slate, Meagher & Flom partner representing ex-Brocade CEO Gregory Reyes, says the close coordination abuses the government’s immunity power, and argues that the agencies should act more independently.
But he doesn’t expect that to happen. “They can turn these things for maximum publicity, and that’s what they do,” he said.
