Broadcom co-founder Henry T. Nicholas III has been indicted on 25 counts, including conspiracy, securities fraud, false certification of financial reports and filing false statements with the SEC. Those charges involve alleged backdating of stock options. But the more salacious part of the story is his indictment on drug charges - specifically conspiracy to distribute and acquire controlled substances. Here's a summary, courtesy of the WSJ's Law blog:
Beginning in 1999, and continuing through 2005, Nicholas and other co-conspirators conspired to distribute MDMA (ecstasy), cocaine and methamphetamine; and, to maintain places, namely, the Rodeo Residence, the Warehouse, the Telescope House, and the Turnberry Condo, for the purpose of distributing and using controlled substances. Nicholas directed co-conspirators and associates to invoice him for controlled substances using various code words, including “supplies,” “party favors,” “refreshments” and “E” (ecstasy). Nicholas spiked the drinks of others with MDMA (ecstasy) without their knowledge, including the drinks of technology executives and representatives who worked for Broadcom’s customers. Nicholas hired prostitutes and escorts for himself and customers, representatives, and associates of Broadcom.
Here's a link to the drug indictment. The "Rodeo" residence refers to a place in Laguna Hills. "The Warehouse" is literally a commercial warehouse in Laguna Niguel. The “Telescope House" is a Newport Coast residence. "Turnberry" is a condo in Vegas. The charges should not come as a surprise to those who have been following Nicholas' legal troubles. A civil suit last year alleged that Nicholas had supplied some of Broadcom’s customers and representatives with drugs and prostitutes. The feds, who initially had been looking into the option-backdating practices, began poking into this drug-related stuff. Here's what I posted last summer:
For my money, Nicholas has never gotten enough attention as one of the nation's weirdest CEOs. In the early 1990s, he co-founded Broadcom in his Redondo Beach apartment, and later, as the company became a billion-dollar maker of computer chips, developed an appetite for private jets, sports cars, and, well, just strangeness (crazy work hours, over-the-top demands, etc.). Out of the blue, Nicholas left Broadcom 2003, saying he wanted to repair his marriage and spend more time with his children (he and his wife are in the throes of a nasty divorce). In the midst of all this, Nicholas has contributed millons of dollars to arts and education causes, and now fancies himself a philanthropist.