Resigned, May 1, 2006; Pleaded guilty to federal charges on Nov.
This is the first case in northern California charging an individual with criminal tax violations in connection with an alleged stock options backdating scheme.
Abrams also allegedly searched for low points in the price of Mercury stock and backdated the exercises to those dates. attorney pointed out that federal tax laws require the payment of ordinary income tax on gains realized on the exercise of non-qualified stock options.
The SEC claimed he earned more than $10 million from his fraudulent conduct. Donlan, the former stock options administrator at Wireless Facilities Inc., pleaded guilty to federal fraud and tax charges relating to stock he fraudulently obtained from WFI during his employment.
In the plea agreement, Donlan admitted that between November 2002 and November 2003 he used his position as WFI’s stock option administrator to issue without authorization 728,229 shares of WFI stock to a brokerage account he controlled, and that he sold the stock for a net gain of $6,252,794.
Reyes obtained his first CEO position with Wireless Access, a Silicon Valley start-up company specializing in two-way pagers.
Reyes served as President and CEO until Wireless Access was bought out in 1997 by Glenayre Technologies.An attorney for Abrams, who hadn’t any comment for the article yesterday, didn’t immediately return a call from today. Thus, if a person exercises non-qualified stock options, purchasing stock at a lower price than fair market value on that date, the difference between the purchase price and fair market value is taxed as ordinary income.Although federal law typically doesn’t require payment of ordinary income tax upon the exercise of incentive stock options, the difference between fair market value and the exercise price is included in alternative minimum tax income, which may trigger the imposition of the alternative minimum tax.After the trial’s conclusion, however, Moore recanted her testimony, claiming that she had been bullied and pressured by the prosecution to give false testimony.In a letter to Fortune Magazine she told an editor that she, as well as other high-ranking members of the finance department, had been aware of the practice of backdating stock options to rank-and-file employees.Gregory Reyes (born September 1, 1962) is an American businessman who most recently served as the Chief Executive Officer (CEO) for Brocade Communications.