12:40pm 01/13/05: Google settles with SEC for not registering options (GOOG) By Bambi Francisco SAN FRANCISCO (CBS.MW) "

The Securities and Exchange Commission on Thursday charged Google Inc. (GOOG) with failing to register $80 million in option grants to employees when the search engine was a private company. The SEC said Google violated registration and disclosure obligations, and charged Google General Counsel David Drummond with causing Google's violation. Google did not admit or deny the Commission's findings, but Google and Drummond agreed to "cease and desist" from violating the requirements. Separately, the California Department of Corporations said it settled civil charges against Google for issuing certain stock options to Google's employees and consultants in 2003 without registering the securities or providing financial information regarding the offering.

I think we all agree that Google has a monster technology.

I think we all wonder how many months a stock like GOOG can trade with a PE over 100, and a PEG ratio that is out of line and might not get better. But then it's possible for a stock to soar longer than I think probable.

I think we all agree that the corporation is growing quickly, but I question whether competitive forces will soon burden the Google growth rate. But, again, maybe Microsoft and others intend to stand aside, although I really doubt it.

Finally, I think, and have been published as such, that Google management operates in strange ways, most of which don't meet my smell test. Today's settlement with the SEC, and the California state regulators as well, is hardly a small step in the direction Google management has taken. My gut tells me the missteps at Google are going to be repeated like a drunken sailor.

But, it's not for me to try to rain on their parade. I do, however, intend today to salute the management team of a Google competitor that I really do respect, which is Yahoo (NDQ: YHOO). Every time I hear the word Google, I think Yahoo. And, for investors, the web pages at Yahoo Finance are simply so good they blow away the competition.

About the future of Internet companies, BC reader David Bennett has added some thoughtful comments to my article earlier on the Internet ETF (AMEX: HHH). He and I are in agreement, but that is precisely why I say it's so important to invest in quality management.

In my view, Messrs Page, Brin and Schmidt of Google are hardly distinguishing themselves as potentially successful managers.

Page and Brin have shown the weaknesses (as well as the strengths) of youth, and I have a sense from pre-IPO comments with respect to their plans to establish the world's biggest/best socially oriented charitable foundation that their arrogance knows no bounds.

With respect to a new charitable foundation by someone who has accomplished greatness in his lifetime, I am very impressed that Hong Kong magnate Li Ka Shing (Li the cash) has decided to sell his 5 percent stake in CIBC, a huge Canadian bank, and use the proceeds to seed a new Canadian charity " C$1.2 billion " which is just shy of being the biggest personal gift to Canadians in the history of Canada. Thank you Mr. Li.

BCara@BillCara.com