Earlier this week, the U.S Securities and Exchange Commission (SEC) charged Broadcom co-founders Henry Nicholas III and Henry Samueli with falsifying the company’s reported income. The SEC also filed a civil complaint against former CFO William Ruehle and General Counsel David Dull.
The four men are accused of misrepresenting the dates on which stock options were granted, a practice called backdating. In its suits, the SEC is seeking injunctions, monetary penalties and that Samueli and Dull be removed from their positions.
The SEC claims that as a result of the backdating, Broadcom restated its financial results in January 2007, reporting more than $2 billion in additional compensation expenses.
Following the accusations, Samueli and Dull have taken leaves of absences from the company, but will continue to serve as non-officer employees during their leaves, Broadcom said in a statement. The company also said that Samueli has resigned as chairman of the board of directors. The board has appointed John Major, an independent director, as non-executive chairman of the board.
Broadcom said it would not comment on the SEC’s accusations, but that “it is important to note that the government’s charges pertain to events that occurred half a decade to nearly a decade ago.”
The company also said that Broadcom settled a suit last month with the SEC related to the company’s stock option granting practices.
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