Where’s SEC in Ryan’s Backdating Task Force?

It looks like the San Francisco U.S. attorney will be first to indict in the stock options backdating bonanza (the story is up free at Callaw.com). But one quick question for Kevin Ryan’s new stock options task force: Where’s the SEC?

Ryan’s announcement Thursday about his new unit — made up of the head of Ryan’s white-collar and securities units, as well as a securities prosecutor and Ryan’s top assistant, along with a bevy of FBI agents — is the absence of the regulatory agency, which has been probing companies accused of backdating with as much verve as the federal prosecutors. Eumi Choi, Ryan’s top assistant and the task force head, didn’t return phone calls Friday afternoon, and San Francisco SEC chief Helane Morrison couldn’t be reached.

While interagency politics on such things are always a mystery, defense lawyers point to an Oregon case that in January instilled a new caution into prosecutors who work with the SEC. The case is U.S. v. Stringer (Peter Henning has the text of the opinion — and a pithy analysis — on his White Collar Crime Prof Blog). In Stringer, Oregon District Judge Ancer Haggerty dismissed securities fraud indictments against three defendants on the grounds that an SEC investigation that turned up evidence leading to the criminal charges was, in essence, a stealth criminal investigation.

Justin Scheck


One Response to “Where’s SEC in Ryan’s Backdating Task Force?”

  1. Mukund Mohan Says:

    This is looking more like a cluster “event”. The Northern California Justice Dept, FBI, SEC and PCAOB. Then you look at each of the regional justice dept. all filing their own cases. Sounds like a bandwagon pile -on case.

    The Securities and Exchange Commission (SEC) has asked the Public Accounting Oversight Board (PCAOB) to delay issuing an alert to accounting firms related to backdating stock options, the Wall Street Journal reported late last week.


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