Synchronized CEO resignations (and electric mails)

Yes, we have no IT Blogwatch, in which a bunch of top bananas' heads roll. Not to mention Weebl and Bob getting the electric mails...

Todd R. Weiss fills us in:

As a federal review into stock options irregularities continues, security software vendor McAfee Inc. today fired President Kevin Weiss and announced the retirement of CEO and Chairman George Samenuk ... In a statement, Samenuk said ... "I regret that some of the stock option problems identified by the Special Committee occurred on my watch." A committee of the McAfee board has been looking internally at the stock options matter, which has been under investigation by the U.S. Securities and Exchange Commission since June 7.
...
As part of a separate stock options investigation, CNet Networks Inc. announced the resignation of Shelby Bonnie, CEO, chairman and co-founder of the company ... CNet will restate its financial results in connection with the reviews. Other executives have also recently left the company, including the chief financial officer, the general counsel and the senior vice president of human resources, the company said.

John Murrell waves his hand in front of that air blower thingy:

Silicon Valley sounds like a bowling alley this morning, resonating with the sound of rolling heads. The stock option backdating scandal that has sparked investigations and restatements across scores of companies took down some big names today ... At CNet ... Bonnie, who will remain on the board, was contrite ... At McAfee, Samenuk also issued what is apparently the boilerplate mea culpa in this mess ... And the bad news doesn't end. The company will take a charge of as much as $150 million to restate 10 years of earnings as a result of the probe.

Paul Roberts asks, "Who's next?":

McAfee Inc. and CNET Networks have become the latest companies caught up in the scandal over stock option backdating. The question is: what other heads will roll? ... All indications are that backdating options was a common practice, especially in the option-happy tech sector. Apple's Steve Jobs has gone on record saying that he knew of the options pricing irregularities. Will he be forced to step down also? If McAfee's actions today are any indication, Jobs' job could be on the line, and more than a few tech firm boardrooms may be getting an emergency facelift courtesy of the SEC.

But wait! There's more, as Nick Douglas explains:

Microsoft Germany's chief quit Friday, leaving a note to employees complaining that Microsoft restricted his operations and ignored him.

Sprint Nextel chief Timothy Donahue ... announced he'll retire early, at the year's end, to "spend more time with his family and friends." As always, that phrase means he was pushed out the door but allowed the dignity of a resignation.

And Richard Koman has another one, albeit with a curious justification:

Andrew McKelvey resigned as chairman and CEO of Monster Worldwide, the parent of Monster.com, saying he could “no longer dedicate the number of hours required” for the company’s review of its stock option grants ... The options review will prevent Monster from stating comparative quarterly results for the quarter ending Sept. 30, 2005.

Peter Lattman digs around:

CNET ... says “a number of executives” including the CEO, the senior vice president of human resources, and general counsel Sharon Le Duy “bear varying degrees of responsibility for these deficiencies.” All have resigned ... Le Duy’s already removed from CNET’s Web site, but thanks to Google’s cache feature, you can ... check out Le Duy’s bio.

Billosaur tells us why we should care:

The trick of "back dating" options so CEOs can cash in on higher returns, coupled with a CEO's knowledge of events in the company, give them unprecedented power to make money off the company's stock while simultaneously causing the company to slide toward oblivion. No one can claim McAfee has exactly been tearing up the anti-virus market of late. Now, having to restate earnings, the stock is threatened with a nose-dive and the other investors are left holding the bag while the defrocked CEOs and Presidents get to walk away with large sums of cash.

Koehn clarifies the legalities:

It's only illegal if you fail to disclose the backdated grants to your shareholders. If you disclose it correctly, it's legal under current SEC regulations.

Buffer overflow:

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And finally... The ELECTRIC mailman calls

Richi Jennings is an independent technology and marketing consultant, specializing in email, blogging, Linux, and computer security. A 20 year, cross-functional IT veteran, he is also an analyst at Ferris Research. Contact Richi at blogwatch@richi.co.uk.