The Star Tribune reports:
"Embattled UnitedHealth Group said Thursday it discovered "a significant deficiency" in its controversial executive stock option program and may have to restate earnings by $286 million for the previous three years.
In a filing with the Securities and Exchange Commission (SEC), the Minnetonka-based company also acknowledged that it is the subject of an "informal inquiry" by the SEC for the manner in which top executives, including chief executive Dr. William McGuire and president Stephen Hemsley, received options worth hundreds of millions of dollars.
The company said it determined it may have to pay taxes and interest on "certain stock options" which it believed were deductible and now may not be. The company said any such charges "could be material."
UnitedHealth also said, "We cannot provide assurance that the company will not be subject to regulatory fines penalties or other contingent liabilities at the conclusion of the company's independent review and the Securities and Exchange Commission's informal inquiry."
The issue of preferential treatment of top executives in the award of stock options has dogged the nation's second largest health insurer for the last several months and prompted its board of directors last week to terminate the program for its most senior management."
Posted by schwitz at May 11, 2006 02:25 PM | TrackBack