Former Owner of St. Louis Blues charged with Securities Fraud

Fraud Crackdown

St. Louis (AP) _ A federal grand jury has charged former St. Louis Blues owner Michael Shanahan Senior, his son and another man with securities fraud.

The former C-E-O of Engineered Support Systems, his son Michael
Shanahan Junior and former C-F-O Gary Gerhardt have been the target
of a federal investigation for two years.

Prosecutors say the three backdated stock options in a scheme that enriched executives and board members of the defense contractor by nearly 20 million dollars. They're charged with falsifying statements, mail fraud and wire fraud.

The indictment says the three were able to ``place their bets before the race'' by retroactively choosing option grant dates that coincided with low points in the company's stock.

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