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Federal Contractor Misconduct Database (FCMD)

The federal government routinely awards contracts to companies with histories of misconduct, including contract fraud and other violations. POGO believes that providing this website will help to improve contracting decisions and increase public knowledge of how the government spends billions of taxpayer dollars each year. Read more…

SEC v. McGuire (Stock Options Backdating)

Former UnitedHealth Group CEO William W. McGuire paid $468 million (including a $7 million civil penalty) to settle a Securities and Exchange Commission (SEC) enforcement action involving alleged stock options backdating. The SEC alleged that during a 12-year period (1994 through 2005), McGuire repeatedly caused the company to grant undisclosed, in-the-money stock options to himself and other UnitedHealth officers and employees without recording in the company’s books and disclosing to shareholders material amounts of compensation expenses as required by accounting rules. The SEC alleged that UnitedHealth filed quarterly and annual financial statements that McGuire knew, or was reckless in not knowing, contained materially false and misleading statements concerning the true grant dates and proper exercise prices of stock options. As a result, investors were misled to believe that stock options were granted with strike prices not less than the fair market value. Without admitting or denying the SEC’s charges, McGuire agreed pay a civil penalty and reimburse the company for all incentive- and equity-based compensation he received from 2003 through 2006.

Misconduct Type
Securities
Enforcement Agency
SEC
Contracting Party
None
Court Type
Civil
Disposition
Settlement
Date of Settlement Announcement
12/6/2007
Contractors Involved Penalty
Total
UnitedHealth Group $468,000,000
Further Information Released
Complaint 12/6/2007
SEC Press Release 12/6/2007

See also:

Federal Contractor Misconduct Database