Apple option backdating scandal
For example, if one signs a contract on February 1, one may backdate it to January 31.
Backdating is usually illegal; for example, one may use backdating to evade taxes.
The mutual fund industry had its purge a few years ago, after fund-manager trading improprieties surfaced.
Some will argue that the fund sector is better today as a result of the crackdown.
Giving retroactive value to purchases from the earlier date.The practice of allowing a mutual fund shareholder to use previous purchases of the fund's shares so as to qualify for reduced commission charges on subsequent purchases.Backdating is used when a fund offers declining proportional sales charges on larger purchases.Let's hope that these past few months -- and whatever lies in store -- will clean up the practice of stock option grants for good. Rick has been writing for Motley Fool since 1995 where he's a Consumer and Tech Stocks Specialist.Yes, that's a long time with more than 20,000 bylines over those 22 years.
In the context of corporate governance, the illegal practice of setting the date of options awarded as part of executive compensation to a period when the stock price was very low (rather than setting the date of the options on the date the award was made).