Steve Jobs, the chairman of Apple Computer, still faces the prospect of an investigation by the Securities and Exchange Commission and the Department of Justice, The Times has learnt, even though he did not benefit personally from the repeated backdating of stock options. Apple published its long-awaited annual report yesterday. It contained details of the company’s internal investigation into options backdating.  

The findings appeared to exonerate Mr Jobs, concluding that, although he was aware of options backdating and even chose some of the dates, he was not aware of the accounting implications of the practice.

The report added that Mr Jobs did not benefit financially from the backdating programme because he returned all the stock options granted to him during the period under investigation.

However, the Securities and Exchange Commission, the US market regulator, which is already investigating the stock options scandal at more than 100 companies, including Apple, told The Times that an executive could be found guilty of backdating without benefiting from the award.

A spokesman for the SEC, who was unable to comment directly on the Apple investigation, said: “An executive does not have to benefit personally from stock options backdating to be found to have violated the rules . . . Past cases show that personal gain is not a precondition to any action by this office.”

The SEC would not confirm whether the company or Mr Jobs was under investigation, but it is understood that investigators from the regulator’s enforcement division next month will begin to look into more than one million pages of evidence gathered by Apple during its internal review of the stock options affair.

The Justice Department is also said to be looking into the backdating of options at Apple. It declined to comment.

A report released by the Transactional Records Access Clearinghouse at Syracuse University concludes that the Justice Department increasingly has refused to prosecute FBI cases targeting suspected terrorists over the past five years. TRAC co-director Susan Long said researchers relied on the Justice Department's own numbers to come up with the findngs. The study was based on the most recent data available from the Justice Department's executive office for U.S. attorneys.

The government disputes the findings as inaccurate and "intellectually dishonest."

Prosecutors declined to bring charges in 87 percent, of international terrorist case referrals from the FBI between October 2005 and June 2006, according to the report.

During the 2001 budget year, prosecutors rejected 33 percent of such cases from the FBI. The data "raise troubling questions about the bureau's investigation of criminal matters involving individuals the government has identified as international terrorists," the report said. Also noted in the report, was the fact that while the number of agents and other employees has risen, prosecutions in traditional FBI investigations since 2001 - including drug cases, white collar crimes and organized crimes - have decreased.

The report states, "So with more special agents, many more intelligence analysts, and many fewer prosecutions the question must be asked: What is the FBI doing?"

A Justice Department spokesman, Brian Roehrkasse noted that terrorist hoax cases that were quickly dismissed may have been included in the government data, adding also that while some cases are referred to prosecutors to obtain subpoenas or other legal orders in investigations, they ultimately never result in criminal charges. Roehrkasse disputed the findings of TRAC and said that prosecutors rejected 67 percent of FBI international terrorist cases in the nine-month period - not 87 percent.

John Miller, the FBI's assistant director, said about half of the FBI's resources go to detection and information gathering of terrorist networks in cases that do not always result in arrests, reflecting changes in how investigations have been conducted since the Sept. 11, resulting in what appears to be a low number of cases prosecuted. Miller said, "It's not about the numbers and for TRAC to suggest as much is to be intellectually dishonest. The FBI has been very clear about how we have changed the way we do business since 9/11."

Breaking Legal News.com
Sheryl Jones
Staff Writer

David Boies's memoir should be a bestseller for two simple reasons. First, his spectacular legal career, representing clients as diverse as Al Gore, George Steinbrenner, the U.S. Justice Department, and Calvin Klein, provides ample material for a compelling exploration of the practice of law in its most high-profile glory. And secondly, the book seems bound to sell well simply because most enterprises Boies gets himself involved with, from lawsuits to Las Vegas gambling, tend to pay off big. In Courting Justice, Boies traces the intricacies of numerous cases, such as Bush v. Gore in the hotly contested 2000 Florida recount, Steinbrenner's action against Major League Baseball, and the U.S. Government's antitrust litigation against Microsoft. At the same time he sheds light on the legal profession itself, exploring the politics of the profession and the power plays endemic to it. As though presenting his cases to a jury, Boies lays out the framework and issues of each case in a patient, step-by-step manner that illuminates the nature of the litigation and Boies's strategy while also supporting the narrative arc of the story he's trying to tell. As with many top lawyers, there is more than a dollop of ego and pride in Boies's accounts. Throughout Courting Justice Boies portrays himself as the voice of reason, possessed of a shrewd sagacity that his rivals and peers can only admire with slack-jawed amazement. Then again, when you look at the numerous legal triumphs and precedent-setting cases he was involved in, especially during the late 1990s, his arrogance is perhaps well earned. Regardless, it lends confidence to his outstanding ability to turn a phrase and tell a story, which, combined with the numerous stories he has to tell, makes David Boies's latest effort a success once again. --John Moe (Amazon.com)