Is Jobs really cleared?

(Fortune Magazine) -- When Apple Computer disclosed on Dec. 29 the results of its own internal investigation into whether CEO Steve Jobs engaged in options-timing irregularities, the probe, conducted by a special committee of outside directors, "found no misconduct by current management," though it "raised serious concerns regarding the actions of two former officers."

The unnamed fall guys are widely reported to be former chief financial officer Fred D. Anderson and former general counsel and corporate secretary Nancy R. Heinen, who had also been Jobs' general counsel at Next.

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Though most investors dearly hope the company's conclusion holds up, many can't quite suspend disbelief. "The idea that Nancy or Fred would've acted independently of the biggest control freak in the entire tech industry is laugh-out-loud funny," says one big Silicon Valley player.

The focus of the probe - and of the SEC inquiry and class-action suits that have followed since Apple admitted a problem in late June - is the huge and well-timed grants to top Apple officers between 1997 and 2002, including two to Jobs. (Full story: Apple says options probe clears Jobs)

The misdatings first began, the special committee found, in December 1997 - three months after Jobs was named interim CEO. The two grants to Jobs were among the largest in history: ten million shares ostensibly granted on Jan. 12, 2000 (when the stock hit its quarterly low), and 7.5 million more dated Oct. 19, 2001.

Apple (Charts) admits the second of those two grants wasn't properly accounted for: The board first approved the grant on Aug. 29, 2001, when the price would have been $17.83, but the grant wasn't "finalized" till Dec. 18, four months later, when the price was $21.01. The grant date was then retroactively set at Oct. 19, 2001, when documentation indicated that a special board meeting had taken place.

However, "such a special Board meeting did not occur," the 10-K filing states, without elaboration. And here's the money quote: "Although the investigation found that CEO Steve Jobs was aware or recommended the selection of some favorable grant dates, he did not receive or financially benefit from these grants or appreciate the accounting implications." (Full story: Apple lets Jobs off easy)

The problem for Apple with this statement is that if Jobs "recommended" favorable grant dates, the company appears to be acknowledging that he advised others to either backdate or "springload" (i.e., grant options just before a market-moving announcement) - both of which are conduct fraught with civil and criminal peril. (Full story: Suit charges Apple with new options woes)

Jobs' purported defense - that he didn't benefit financially - is hardly airtight and is also similar to one that former CEO Greg Reyes of Brocade Communications (Charts) is expected to test in the federal felony prosecution brought against him in July by the same U.S. Attorney's office whose bailiwick includes Cupertino, Calif., where Apple is based.

Lawyers for Heinen and Anderson have issued statements vigorously denying any wrongdoing, and the famously secretive Jobs has reportedly hired criminal defense attorney Mark Pomerantz, although neither Apple nor Pomerantz would confirm at presstime.

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U.S. said to probe Apple's Jobs' options