UnitedHealth Group has settled with securities regulators over the use of stock options. The Minnetonka company won't pay a penalty, but its former general counsel will.
The investigation stemmed from a stock options backdating scandal at UnitedHealth two years ago. Former chief executive Bill McGuire and General Counsel David Lubben left the company as a result.
The Securities and Exchange Commission says since then, UnitedHealth has improved its corporate governance and internal controls, offering "extraordinary cooperation" in the investigation.
UnitedHealth is not charged with fraud and will not have to pay a penalty. The company did not admit wrongdoing but promised to keep proper books going forward.
The SEC has filed backdating related fraud charges against former General Counsel Lubben. He'll pay a $575,000 penalty and is barred from serving as an officer or director of a publicly held company for five years.
Last year, the SEC reached a deal with McGuire.
This is the statement that Minneapolis-based UnitedHealth Group issued today:
UnitedHealth Group is pleased to have resolved this matter with the SEC and will continue to focus on serving its customers, growing its businesses, reinforcing its community and customer relationships and helping people live healthier lives. Over the past two years, the Company has substantially improved its governance, administrative processes and internal controls, helping it become one of the top ranked companies in both the health care industry and the S&P 500 for overall corporate governance.
The Commission declined to charge the company with fraud or seek a monetary penalty, pointing to the companys extraordinary cooperation in the Commissions investigation, as well as its extensive remedial measures.
Without admitting or denying the SECs allegations, UnitedHealth Group has agreed to a permanent injunction against any future violations of certain reporting, books and records and internal accounting control provisions of the federal securities laws. This settlement is subject to approval by the U.S. District Court for the District of Minnesota and concludes the SECs investigation of this matter with respect to UnitedHealth Group.