Former Monster Worldwide execr charged in option dating case

James Treacy, 50, of Glen Rock, N.J., was charged with conspiracy to commit securities fraud, filing false reports with the Securities and Exchange Commission, making false statements to auditors and falsifying books and records.

An indictment in U.S. District Court in Manhattan accused him of conspiring with others to backdate millions of dollars' worth of employee stock option grants.

An SEC complaint filed in New York sought to force Treacy to give up any illegal gains, impose financial penalties and ensure Treacy could not commit financial wrongdoing in the future.

Evan Barr, his lawyer, said: "Mr. Treacy is completely innocent of these charges and looks forward to being vindicated at trial."

Prosecutors say the backdated option grants caused the understatement of $339 million in expenses between 1997 and 2005 by Treacy, who served the company at various times as chief operating officer, executive vice president and president.

They said Treacy received more than a million options himself on eight different grant dates, gaining more than $23 million.

"With the benefit of hindsight, Treacy created an opportunity for himself and others at Monster to reap substantial benefits by awarding backdated option grants with particularly advantageous exercise prices," the indictment said.

"By perpetuating the backdating scheme, therefore, Treacy and his co-conspirators not only reaped the benefits of receiving in-the-money options, but also misled the public about the financial well being of the company," it added.

Options give employees the right to buy shares of stock at a predetermined price. Backdating refers to pegging options awards to dates in the past when the company's stock price was low. It isn't illegal, but companies must take charges connected to the practice.