Once upon a time, in a political climate that was far simpler than that of the 21st century, President Harry Truman reportedly took responsibility for his actions with the phrase, “the buck stops here.”
These days, the blame for a serious transgression of one sort or another is usually deflected to a subordinate who is forced to take the blame for the boss. Does that same philosophy exist over at Apple, Inc.?
Well, consider that the SEC has gone after for Apple CFO Fred Anderson for his part in that stock options scandal that has caused the company to restate its earnings for a period of several years. Former head legal counsel Nancy Heinen, who is facing civil fraud charges in connection with these episodes, is apparently hanging tough, so her case is not apt to be resolved so quickly.
Now it’s not that Anderson and Heinen face jail time for their crimes. They left Apple as millionaires, and facing fines to settle their scores with the authorities will have, at best, a minor impact on their bank accounts. That assumes, of course, that Heinen eventually reaches some sort of settlement, which isn’t certain right now.
As far as Anderson is concerned, his deal with the SEC involves no admission of wrongdoing, so there’s nothing to prevent him from performing the same duties at another company. In the end, it may not be so easy for him to find a new job, as his career has, no doubt, been irrevocably tainted. But it’s not as if his family will suffer, or that he’ll be taunted by kids as he walks the streets, assuming he doesn’t travel strictly by limousine and private jet.
Indeed, what Anderson and Heinen apparently did amounts to the violation of an obscure set of regulations that the companies who violated them probably weren’t all that concerned about. They probably never expected these questionable transactions to become fodder for public investigations, possible prosecutions and constant attention in the business pages of your daily newspaper.
Now it does seem that Steve Jobs has indeed dodged the bullet here. By dealing with Anderson and Heinen, Apple will apparently escape relatively unscathed from this nasty affair. That means Steve Jobs remains as CEO, which pleases customers, stockholders and, of course, Wall Street, no end.
On the other hand, it doesn’t seem as if Anderson wants his former boss to be let off so easily.
In a statement released on Tuesday, Anderson placed the blame for at least part of the stock options affair right into the lap of Steve Jobs. Anderson claimed that he was obeying his CEO’s instructions in following through on those stock options and that he warned Jobs about the possible consequences.
Maybe that statement helps lessen Anderson’s blame in this affair, if we take the claim at face value. But it’s probably self-serving, since it’s not terribly likely that the SEC is now going to refocus its attention on Jobs and somehow force him to face unsavory consequences.
You see, nobody really wants Steve Jobs to leave Apple. Certainly, he’d have to engage in some egregious behavior for the SEC or other authorities to take further interest. To be sure, Apple’s customers are happy with Apple’s product focus since Jobs returned to rescue the company, and the company’s stockholders are certainly pleased with the stock price and profit and loss statements.
Wall Street and the tech press have made Apple the media’s darling for the moment. The four-month delay in releasing Mac OS X Leopard has had little impact. At worst, Apple will simply wait longer for the potential income from the sale of its new operating system, but it’s not as if Mac sales appear to be suffering to any noticeable degree.
At one time Apple probably felt that they needed to get Leopard out quickly to remain competitive with Windows Vista. But Vista is apparently not doing quite as well as Microsoft claims, and sales of new Macs remain ahead of the rest of the PC industry. There’s no serious pressure for Apple, except to deliver the iPhone in time for its promised released date in June, and to build a product that is near-perfect from the get-go.
No doubt the SEC and the question of illegal stock options will be forgotten within a few more months. It probably won’t be resurrected except in year-end reviews, or perhaps in the back pages of a paper’s business section when they run out of material.
Apple ought to consider itself lucky to have emerged from this affair without serious wounds. As for Steve Jobs, let’s just call him the “Teflon CEO,” and that, is they say, is that.
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