Former KB Home CEO Bruce Karatz Indicted for Fraud

The former CEO of KB Home, Bruce E. Karatz, has been charged with multiple counts of fraud and other crimes related to a stock option backdating scheme that bilked the homebuilder's shareholders out of millions of dollars.In addition to selling various types of homes, KB Home offers mortgage services in a joint venture with Countrywide KB Home Loans, which is now the property of Bank of America. KB also provides title and insurance services to homebuyers through a subsidiary. The 20-count indictment against Mr. Karatz charges the former chief executive with 15 counts of mail, wire and securities fraud, four counts of making false statements in reports filed with the Securities and Exchange Commission and one count of lying to the company's accountants. Mr. Karatz is expected to make an initial court appearance on March 26, 2009. "We will show a jury that Bruce Karatz, who as a CEO helped create 5,000 jobs and oversaw significant company growth, acted appropriately," said John Keker, Mr. Karatz's attorney, in a statement.