It was the first company to be traded on the NYSE as a home builder and was a Fortune 500 company from 2000 through 2008. The company has built 550,000 homes since its founding.
Law360, New York (November 13, 2006, AM EST) -- The nation's fifth-largest home builder found itself in troubled waters on Sunday after an internal investigation revealed errors in the company's accounting of stock option grants, prompting its chairman and chief executive to become the latest high-ranking official of a publicly-traded company to step down amid the widening scandal over stock-options backdating. 12 that CEO Bruce Karatz and Richard Hirst, executive vice president and chief legal officer, had resigned, while Gary Ray, the head of human resources, had...
KB Home is a homebuilding company based in the United States, founded in 1957 as Kaufman & Broad in Detroit, Michigan.
--------------------- April 21, 2010 The former head of KB Home is convicted of mail fraud and making false statements. Bruce Karatz, who helped turn KB Home into one of the nation's most successful home-building companies during two decades as its chief executive, was convicted Wednesday on four felony charges related to stock option backdating.
A federal court jury in Los Angeles convicted Karatz of two counts of mail fraud, making false statement in public filings with the Securities and Exchange Commission and making false statements to accountants of a publicly traded company. Karatz, 64, had faced 20 felony charges related to the backdating of stock options at the Westwood-based home-building company he ran from 1986 to 2006.
Ruehle, accusing prosecutors of a "shameful" campaign to intimidate witnesses and obtain unjustified convictions.
Last year, James Treacy, the former president of job search company Monster Worldwide Inc., was convicted of options-related charges and sentenced to two years in prison.
Karatz retroactively tied the exercise price of his options to dates when the stock was selling for a low price, which increased his profit when he sold the shares.
The maneuver is legal if it is properly accounted for and disclosed to investors.
Last year, a federal judge in Orange County threw out similar cases against Broadcom Corp. Nicholas III and Chief Financial Officer William Ruehle, citing prosecutorial misconduct. Prosecutors claimed Karatz illegally backdated his stock options between 19 while he was chairman and chief executive of KB Home.