Is option backdating illegal
The position is then clear to all who subsequently look at the document.
Another way is to state at the beginning of the document that it is made “as of” the required date.
Because even putting “as of” a certain date will not protect the lawyer from implication in a criminal act if the purpose of the backdating is actually to defraud or mislead the taxman, any regulatory authority or even any other individual and the lawyer knew or should have known that this was the case.
So as can be seen, the issue of backdating can be a contentious one.
Whenever I write about backdating, many people write in to tell me that backdating’s not illegal; you just have to account for it correctly.
The event did not happen during the time period required for the benefit so an attempt is being made to pretend that it did.The argument is obviously not valid if the transaction is one which is required by law to be in writing such as a transfer of land.This is not an agreement that could have been made orally.Does he need to check to see whether that was actually the case or can he take an ostrich-like position and put his head in the sand and not ask any questions?Is there an obligation on the lawyer to make at least reasonable endeavour’s to confirm that he is being told the truth?
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For example, will the document be provided in support of the party’s tax position giving the impression that a signed legal contact was in place before it was?