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U.S. Securities and Exchange Commission

SEC Charges Former General Counsel of Monster Worldwide, Inc. for Backdating Options


Washington, D.C., Feb. 15, 2007 - The Securities and Exchange Commission today charged Myron F. Olesnyckyj, the former General Counsel of Monster Worldwide, Inc. with securities fraud for participating in a multi-year scheme to secretly backdate stock options granted to thousands of Monster officers, directors and employees, including himself. Olesnyckyj, along with others, falsified documents to make it appear as if the company had actually granted options on certain dates. In reality, the grant dates had been selected after the fact by looking backward for a date on which the stock price was low. By backdating and improperly accounting for options, Monster granted undisclosed compensation to its employees, failed to recognize compensation expenses, and overstated its net income by $340 million from 1997 through 2005. Olesnyckyj, 45 and a resident of New Providence, N.J., personally profited by receiving backdated options.

Linda Thomsen, Director of the Commission's Division of Enforcement, said, "By backdating the vast majority of the stock options it granted, Monster, one of the premier Internet companies of the last decade, used the lure of instant 'paper profits' to attract and retain its employees without booking the appropriate employee compensation charges. This scheme defrauded Monster's investors. The SEC will continue to work tirelessly to uncover and to stop such conduct."

Mark Schonfeld, Director of the Commission's Northeast Regional Office, said, "Olesnyckyj knew that backdating was wrong but nonetheless went along with the scheme. Any lawyer who works at a public company should do everything possible to thwart fraud — not participate in it."

The complaint alleges that, from 1997 through 2003, Olesnyckyj backdated stock options grants to coincide with the dates of low closing prices for the company's common stock, resulting in grants of in-the-money options to numerous individuals. When making grants of options to numerous recipients, certain officers and employees at Monster would select a low closing stock price at which they wanted to grant stock options. Olesnyckyj, or others acting at his direction, prepared backdated documentation for Monster's Compensation Committee containing the grant date that reflected the low closing price for Monster's common stock. Olesnyckyj then caused Monster to misrepresent in its periodic filings and proxy statements that all stock options were granted at the fair market value of the stock on the date of the award, when that was not the case.

The complaint further alleges that Olesnyckyj misled Monster's outside auditors in an attempt to hide the backdating scheme by providing documentation to them that misrepresented the grant date of the stock option awards.

The Commission acknowledges the assistance of the United States Attorney's Office for the Southern District of New York and the United States Postal Inspection Service, which conducted their own separate, parallel investigation resulting in distinct criminal charges.

The Commission's investigation in this matter is continuing.

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For more information, contact:

Helene Glotzer
Associate Regional Director
Northeast Regional Office
U.S. Securities and Exchange Commission
(212) 336-0078

Kay Lackey
Assistant Regional Director
Northeast Regional Office
U.S. Securities and Exchange Commission
(212) 336-0117

  Additional materials: Litigation Release No. 20004



Modified: 02/15/2007