Take-Two General Counsel Sentenced in Options Backdating Case

August 17, 2007 (PLANSPONSOR.com) - Former general counsel for Take-Two Interactive Software Inc., Kenneth Selterman, was sentenced on August 8 to three years of probation for falsifying a letter to regulators in a stock options backdating probe.

Bloomberg News reported that Selterman is the third formal official from the Grand Theft Auto gamemaker to be convicted in the probe (See  Video Game Maker Reveals Backdated Options ). His sentence also included 200 hours of community service and a fine of $50,000.

On June 6, Selterman admitted providing false information about employee stock options in a 2002 letter to Nasdaq Stock Market Inc., the news report said. Manhattan Assistant District Attorney Marc Scholl said at the hearing that Selterman had restored to Take-Two over $600,000 in unjustified compensation.

Take-Two’s ex- chief executive officer and former accounting chief also previously pled guilty and received probation for falsifying records.

In related news, Reuters reports that the gamemaker said Wednesday it has received a Wells notice from the Securities and Exchange Commission (SEC) indicating that charges may be filed against the company resulting from an investigation of its past stock options practices.

The Wells notice gives Take-Two a final chance to respond to the SEC and convince the agency not to file charges. The company said it plans to settle the charges, according to Reuters.