Two snared on Apple options

Heinen, Anderson facing charges

By ASSOCIATED PRESS

Securities regulators plan to file civil fraud charges this week against Apple's former general counsel and have worked out a settlement with its former CFO over their alleged roles in the company's stock options scandal.

Cris Arguedas, a lawyer for former Apple counsel Nancy Heinen, said Monday that the Securities and Exchange Commission has informed attorneys that it plans to file a lawsuit against Heinen alleging fraud in connection with two options grants. One involved a grant to Apple chief exec Steve Jobs on Oct. 19, 2001, for 7.5 million shares and another involved a grant made to top executives, including Heinen herself, on Jan. 17, 2001.

"We do expect them to file against our client and we will be defending those charges because they are a misunderstanding of the activities of Apple," Arguedas said.

Meanwhile, Apple's former CFO Fred Anderson, who faces a different set of securities violations related to the same two grants in Heinen's case, has hammered out a settlement with SEC officials, according to a person familiar with the matter. The person requested anonymity because the SEC has not yet announced its civil actions in the Apple case.

Under the expected settlement, Anderson has agreed to pay a fine of about $150,000 and repay option gains of about $3.5 million, the person said. His case involves securities violations including filing false financial statements, but he is not admitting to any wrongdoing as part of the settlement, the person said.

The settlement will not bar Anderson from serving as a corporate officer or board member of public companies, the person said.

Heinen and Anderson would be the first Apple executives to face legal action since the Cupertino-based maker of iPods and Macintosh computers acknowledged last year that it had backdated some stock options grants, including the one to Jobs where Apple said the grant date was improperly pegged to the October date instead of the correct date of Dec. 18, 2001.

The U.S. attorney's office also is investigating Apple for the accounting irregularities but declined to comment Monday about the status of its case.

Arguedas said her client did not break any laws.

"It's not a backdating case," she said. "It's a case in which the grant dates moved to later dates and higher prices."

Arguedas said the two key grants in question were approved by Apple's board of directors and issued in compliance with securities laws at the time, which she says allowed stock options to be tied to the dates when the company first knows who would be getting a certain amount of stock options.

Apple's own internal probe cleared Jobs and any current officers of misconduct but pointed to "serious concerns" about the actions of two unnamed former employees, now widely believed to be Heinen and Anderson.