McAfee Exec.: Not Guilty on Options Charges

A former McAfee  general counsel pleaded not guilty to federal fraud charges over his involvement in stock option grants in 2000 and 2002. Kent Roberts, indicted Wednesday, yesterday paid $1 million in bail and is set to return to court Monday, his lawyer told

If convicted, Roberts, 50, could receive 20 years in prison and a $250,000 fine for mail fraud, wire fraud and filing false documents with the Securities and Exchange Commission (SEC).

According to the seven-count federal grand jury indictment announced earlier this week, Roberts is charged with “devising a scheme to defraud” by granting himself and others within Network Associates (which is now part of McAfee) stock options in 2000 and 2002, claimed the U.S. District Attorney’s office in the Northern District of California.

Roberts allegedly concealed changes made in the date and price of 20,000 Networks Associates’ stock in 2000, according to the indictment. Federal prosecutors also claim Roberts recommended the removal of the then-controller who assisted the stock option grant changes. Roberts, while leading an investigation into the controller’s conduct, allegedly withheld his role in the affair from the company and the SEC.

The indictment additionally charges that, in 2002, Roberts falsified an entry in Network Associates’ board minutes indicating the then-CEO and chairman was granted a stock option a day later than he actually was.

Last May, McAfee dismissed Roberts amid an accounting probe. The same year, McAfee paid a $50 million penalty to settle a federal regulatory investigation. CEO George Samenuk also resigned early due to the options questions.

Roberts is just the latest executive to face federal charges in the widening probe into companies’ stock option backdating practices. Last month, Myron Olesynyckyj, former general counsel of online job site pleaded guilty to security and fraud charges. If convicted, he could face up to 25 years in prison.

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