Monster of a Case
February 14, 2007— -- The former top lawyer for the Internet job search site Monster.com is expected to enter a guilty plea tomorrow, growing out of his role in backdating stock options at the company, federal officials involved in the case tell ABC News.
Officials say Myron Olesnyckyj, the former general counsel of Monster, has agreed to plead guilty to charges of securities fraud in federal court in New York City, as part of a deal to cooperate with prosecutors.
Olesnyckyj is expected to provide testimony about his former boss, Andrew McKelvey, the founder and former CEO of Monster.com, the officials say.
A spokesman for Monster.com said the company was also cooperating but would not comment further.
The plea deal comes as dozens of former CEOs and other corporate officials face possible indictment as the Department of Justice presses its investigation of the backdating of billions of dollars of stock options.
The FBI, IRS and U.S. Postal Inspectors are working on at least 60 active criminal investigations, and federal officials tell ABC News at least a half dozen are now in the final phases of investigation.
"This is a major initiative of the President's Corporate Fraud Task Force," said Justice Department spokesman Brian Sierra.
Dozens of CEOs and other top officials have already resigned over the practice of "stealth compensation," in which executive pay packages have been enhanced by granting executives the right to buy stock at favorably low "strike prices" set by acting as if the options were granted earlier than they were, resulting in a larger potential profit.
Prosecutors say the failure to disclose the backdating can constitute securities fraud.
More than 140 companies are under investigation by the Securities and Exchange Commission, and federal prosecutors are known to be considering criminal indictments in a number of the SEC cases.
The chairman of Apple Computer, Steve Jobs, has also been questioned by federal investigators in San Francisco about the backdating of stock options at the company. Apple says an internal investigation by its board cleared Jobs and all members of the company's current management of any wrongdoing and says there has been no indication that Jobs is considered a target of any criminal investigation.
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