Monstrous SEC Penalty for Option Backdating

Former Monster CEO Andrew McKelvey agreed to pay over $250,000 in fines to the Securities and Exchange Commission and has been barred from serving as a director or executive of a publicly-traded company. McKelvey and two other executives authorized the backdating of stock options to four Monster employees (NOT including McKelvey) without properly recording compensation expense. As a result, Monster overstated pretax income by about $340 million in the aggregate during the 1997-2005 period.

Hard to argue the SEC decision, but what a cost without personal benefit. Moral: make sure that you know and do on FASB and PCAOB standards.