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Administration January 29, 2008
SafeNet Former CFO Gets Fine, Jail Term for Backdating
January 29, 2008 (PLANSPONSOR.com) - Carole D. Argo,
former chief financial officer at SafeNet, maker of computer
network security products, was sentenced Monday to six months
in prison and fined $1 million for securities fraud in
connection with stock options backdating at the
company.
Reported by Rebecca Moore
Argo pled guilty in October to securities fraud, and admitted she backdated millions of dollars’ worth of employee stock option grants at SafeNet, according to the New York Times. Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York said Argo deserved a lenient sentence because of her charitable work and because her crime was less serious than other financial frauds of the last decade, the news report said.
Rakoff said federal sentencing guidelines in the case called for a prison term of nine to 10 years, and the federal probation office had recommended a sentence of nearly five years.
Argo’s lawyer said she had already given back $236,000 in profits, and it was unlikely she could afford the $1 million fine.
According to a MarketWatch news report, Argo was accused of being involved in a scheme that took place between 2000 and 2006 in which the company backdated stock option grants and failed to record and report compensations expenses related with those grants.