[Congressional Record Volume 152, Number 67 (Thursday, May 25, 2006)]
[House]
[Page H3231]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      BACKDATING OF STOCK OPTIONS

  (Mr. EMANUEL asked and was given permission to address the House for 
1 minute and to revise and extend his remarks.)
  Mr. EMANUEL. Madam Speaker, this may sound strange coming from a 
Democrat, but I am here to applaud the Wall Street Journal for its work 
in uncovering a major corporate scandal.
  After Enron and WorldCom, we enacted Sarbanes-Oxley to usher in a new 
era of corporate responsibility. But now a new scandal is brewing, this 
time involving the backdating of stock options.
  When a company backdates stock options, it deliberately moves option 
grants back to dates when the stock price was lower, ensuring the 
options will make money for executives while hiding its real cost from 
shareholders and the IRS. It is free and cheap money for the CEO, and 
securities fraud for everyone else, plain and simple.
  So far, United Healthcare appears to be the biggest perpetrator, but 
the problem now is spreading to 15 other public companies that are 
under investigation at this point.
  Madam Speaker, the American people don't deserve another Enron or 
WorldCom. They deserve an era of corporate responsibility that they 
were promised from this institution. As the SEC and the Justice 
Department pursue these cases, I hope they will take swift and decisive 
action to punish those involved and restore investor confidence in our 
markets.

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