US healthcare executive pays back $600m in stock options caseBMJ 2008; 336 doi: https://doi.org/10.1136/bmj.39435.632188.DB (Published 03 January 2008) Cite this as: BMJ 2008;336:12
- Janice Hopkins Tanne
- 1New York
William McGuire, former chief executive officer and chairman of the board of UnitedHealth Group, has agreed to return $468m (£235m; €325m) to the healthcare company he ran for about 15 years. With other payments, he is returning some $600m to the company.
The US Securities and Exchange Commission said that Dr McGuire and other employees had been granted stock options in UnitedHealth Group that were “backdated” to a day when the company’s stock was at a low price.
Stock options are usually granted at that day’s market price, so backdating them to a day when the company’s stock was low means that anyone exercising the option and selling the stock would be guaranteed a profit. Such transactions could affect a company’s reported earnings and its share price and might have tax consequences for the company and any individual exercising the options. …