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Until now, Apple (Nasdaq: AAPL) CEO Steve Jobs has managed, barely, to remain personally unsullied by the stock options backdating scandal that has engulfed Apple. Indeed, former CFO Fred Anderson, who settled a civil suit with the Securities and Exchange Commission on Tuesday, was expected to stay quiet on the issue for the time being.
Instead, following the announcement of his agreement to pay back US$3.5 million in resulting gains, Anderson released a statement that creates more uncertainty surrounding Jobs' role and his general awareness of backdating events in 2000 and 2001.
Due Diligence
Anderson had informed Jobs about the ramifications of the accounting charge, and Jobs had assured him that the company's board of directors was conducting the necessary legal due diligence, according to his attorney, Jerome Roth, a partner at Munger, Tolles and Olson in San Francisco.
"Fred cautioned Mr. Jobs that the executive team grant would have to be priced based on the date of the actual board agreement or there could be an accounting charge," says Roth in a statement.
"He further advised Mr. Jobs that the board would have to confirm its prior approval in a legally satisfactory method. He was told by Mr. Jobs that the board had given its prior approval and the board would verify it," he continues.
"Fred relied on these statements by Mr. Jobs and from them concluded the grant was being properly handled," the attorney says.
Attempt to Heal
The SEC had filed civil suit against Anderson for his failure to ensure that the financial statements the company filed were correct. Under terms of the settlement, Anderson admitted no wrongdoing. He will still be able to serve as an executive officer or on a board of directors for public companies.
The statement is likely an attempt to rehabilitate Anderson's reputation.
"Fred had absolutely no knowledge of any alteration of board documents, and this is reflected by the fact that he is not even mentioned in those charges," the lawyer's statement emphasizes.
Jobs in the Spotlight
Whether it was also Anderson's intent to raise suspicions about Jobs' role is not clear -- but that is probably going to be the end result.
A special committee investigating the charges had already cleared Jobs of any wrongdoing. In fact, nothing from the SEC has pointed to personal culpability on the part of the iconic CEO.
"This statement from Anderson's lawyer provides a direct linkage from Jobs to the stock options backdating," Paul Bessette, a partner with Akin Gump, told MacNewsWorld.
"It muddies the waters for Jobs," he said.
Not that Anderson's statement is going to translate directly into a Go to Jail card for Jobs. "It doesn't prove anything," Bessette added. "How specific was Anderson about the accounting ramifications is one question that needs to be answered. There is still much that remains unclear."
It is doubtful that this new information will present additional difficulties for Jobs, agrees Jim Sanders, a partner with McDermott Will & Emery.
"Let's assume Anderson already gave this information to the SEC," he told MacNewsWorld. "If the SEC didn't think it was worth pursuing -- they haven't taken any action against Jobs -- then it probably doesn't mean that much in terms of Jobs' guilt or innocence."
Ongoing Issue
To be sure, even if Anderson had faded quietly into the night after his settlement announcement, it would hardly have meant closure of the issue for Apple -- and by extension, for Jobs. The SEC has also filed a civil suit against the company's former attorney, Nancy Heinen. She allegedly falsified documents about the backdating of stock options grants to executives in the early 2000s, violating federal securities law.
Heinen is fighting the charges. Assuming that her case will go to court, it is possible that additional details regarding Jobs' involvement will come to light.
Meanwhile, the U.S. Department of Justice is conducting its own investigation of Apple, which could result in federal criminal charges as opposed to the civil charges the SEC is able to levy.
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