RIM co-CEOs could face $100 million penalty
Jim Balsillie and Mike Lazardis aren't looking forward to getting e-mail on their BlackBerrys about a possible fine from a Canadian regulator over stock options.
Research In Motion's co-CEOs could be facing a hefty fine for their involvement in yet another stock options-backdating scandal.
The Globe and Mail reports that the Ontario Securities Commission--the Province of Ontario's SEC--is considering imposing fines of up to C$100 million ($79 million) on RIM's Jim Balsillie and Mike Lazardis as punishment for allowing stock options backdating to occur on their watch. Balsille would have to pay the majority of the fine, according to the report, which, if it reachs $100 million, would be a record for Canada.
Like many technology companies over the last decade, RIM was found to have awarded backdated stock options to executives, including Balsillie and Lazadis. As many as 40 percent of those awards were assigned an improperly chosen grant date designed to inflate the value of the award. That's legal in the United States, if properly disclosed and accounted for, but that rarely happened.
The two executives have already repaid RIM for the gains they incurred improperly, as well as the legal costs of defending the actions.