SEC alerts companies sooner when probes completed

By Rachelle Younglai

WASHINGTON, Nov 9 (Reuters) - The U.S. Securities and Exchange Commission is closing out some of its stock options backdating cases and alerting companies when the agency completes investigations.

Under a new policy that was put in place about six months ago, the SEC tells the individuals and companies it is investigating once agency lawyers decide against recommending charges.

Previously, companies and individuals had to ask for a letter, which was not always provided because the SEC had to take administrative steps to close out a file.

"Now, at the earliest opportunity we provide such communications even if people don't ask," Walter Ricciardi, the SEC's deputy director of enforcement, told Reuters in an interview this week.

"Staff is encouraged to close an investigation at the earliest point when it becomes apparent that no enforcement action will be recommended."

Recently, companies such as Nvidia Corp (NVDA.O: Quote, Profile, Research, Stock Buzz) and PMC-Sierra Inc (PMCS.O: Quote, Profile, Research, Stock Buzz) said they received such letters from the SEC.

During the past two years, more than 180 companies have been investigated by the SEC or have conducted their own internal inquiries into possible manipulation of stock option grant dates.

So far, the SEC has brought civil enforcement actions against seven companies, plus 26 former executives associated with 15 companies.