Monster options probe seen widening

Federal investigators investigating job search Web site are focusing on e-mails from fired former general counsel.

NEW YORK ( -- Federal prosecutors looking at allegations of stock-option manipulation at Monster Worldwide are focusing on emails written by the company's former general counsel that suggest he knew the accounting implications of backdated options, according to a published report.

The Wall Street Journal reports that prosecutors may be seeking to focus on Myron Olesnyckyj, the former general counsel who was suspended and then fired by Monster Worldwide (Charts) last year. The paper says investigators may try to win his cooperation in investigating more senior officials, and that prosecutors have sought to interview several former and current Monster employees.

Last month Monster admitted to "intentional" backdating of stock options over a six-year period by former officials, and restated income over a nine-year period by $272 million due to the backdating. The statement said the backdating was done by "persons formerly in positions of responsibility" although it did not identify anyone.

Monster's founder, Andrew McKelvey, stepped down from the CEO post Oct. 9 and three weeks later resigned from the board after declining to be reinterviewed by lawyers conducting an internal probe of the options matter. Olesnyckyj was fired in late November.

The Journal reports that federal prosecutors are focusing on emails with senior finance and human resources officials in which Olesnyckyj indicated his understanding of the accounting rules and how grants should be properly handled. Separately, another email involving high level officials discussed "the finessing" of outside auditors, according to people who have seen the email.

Monster is one of nearly 140 companies, many in technology, under federal investigation for possible stock options manipulations. Perhaps the highest profile case involves options at computer and media player maker Apple (Charts), which has admitted to wrongdoing involving the dating of options but insisted an internal probe has cleared Chairman and CEO Steve Jobs.

Among the other companies that have seen CEOs leave due to the options probes are McAfee (Charts) Chairman and CEO George Samenuk, who left the company two days after McKelvey gave up the CEO post at Monster, and United Health Group (Charts) CEO William McGuire, who also resigned in October.

Some executives are facing even greater trouble.

Brocade Communications Systems (Charts) ex-CEO Gregory Reyes was indicted on securities-fraud charges in August, and Comverse Technology (Charts) former CEO Kobi Alexander left the country facing bribery and securities fraud charges, only to be arrested in Namibia a month later.

Monster competes against KForce Inc. (Charts), which will be releasing its fourth-quarter earnings report on Feb. 7.

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