Guilty verdict for former KB Home chief

By Chris Sleight29 April 2010

Bruce Karatz, the former CEO of US house builder KB Home has been found guilty of various offences, including mail fraud and making false financial statements. He was however acquitted of securities fraud - charges that related to the backdating of stock options.

Out of a total of 20 charges made against him, Mr Karatz was found guilty of just four by the District court in Los Angeles. However, these guilty verdicts carry a maximum penalty of 80 years in prison.

Mr Karatz's lawyers say they will appeal the verdict, and have asked for a fresh trial.

Despite the guilty verdicts, the failure to convict on the backdating charges is a blow for the US government. It had been seeking to crack down on the practice, whereby executives receiving stock options can select a recent low point in the stock market to buy them, maximising their profits. The practice itself is not illegal, but failure to properly disclose it is.

Latest News
Rental Briefing: daily newsletter for rental sector being launched by KHL
Newsletter will provide analysis, comment and insight into the global industry
Work progresses on Four Frankfurt project
T1, the highest tower in the quartet, will have a height of 233m
Construction equipment bodies respond to UK’s net zero shift
Association bosses say ‘softer package’ sends wrong message to the industry