Former KB Home chief executive Bruce Karatz has been sentenced to five years probation, including eight months of house arrest, for his conviction on charges of backdating stock options.

U.S. District Court Judge Otis Wright also ordered Karatz to pay a $1 million fine and complete 2,000 hours of community service.

Karatz, 65, was convicted in April on three felony charges that he concealed the backdating of stock options by KB Home executives. Options can be legally backdated to lower stock prices and increase value. But the backdating must be disclosed in company filings.

Federal prosecutors had recommended that Karatz be sentenced to 6.5 years in prison and ordered to pay $7.5 million in fines.

But Wright sided with federal probation officials who recommended that Karatz’s sentence be limited to house arrest and probation.

The probation officials cited Karatz’ record of community service and charitable contributions.

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