Kb homes and backdating
Ray’s testimony under oath that he conspired with Karatz in the backdating scheme — which contrasted with his earlier statements to investigators — was unreliable and comprised of “concoctions,” Keker said.
Karatz’s legal team brought in well-known local celebrities to act as character witnesses for Karatz.
Karatz was suspended from practicing law in August 2010, pending the final disposition of the disciplinary matter, according to state bar records.
LOS ANGELES/SAN FRANCISCO (Reuters) - Bruce Karatz sought to boost his pay by illegally backdating stock options, prosecutors argued on Thursday at the close of their case against the former head of KB Home, as defense attorneys portrayed him as a victim of prosecutorial zeal.
Karatz sat quietly between his lawyers at the defense table, wearing a blue suit and striped tie, his hands folded and looking straight ahead, occasionally glancing at the prosecutor.
His wife, Hollywood philanthropist Lilly Tartikoff, sat in the front row of the courtroom.
Backdating is a practice of locking in financial gains by retroactively pricing option grants on days when a company’s stock price was low, thereby increasing the value of options.
It is legal when recorded as a non-cash compensation expense.
These backdated options with discounted exercise prices allowed him to reap millions of dollars that were never disclosed or recorded as compensation, the government claims.
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