Comverse backdating settlement
Photo Credit: Bloomberg News / Naashon Zalk Jacob “Kobi” Alexander, the former CEO of Long Island software firm Comverse Technology who fled to Africa to avoid fraud charges, was sentenced Thursday in Brooklyn federal court to 30 months in prison. When he fled, he allegedly misled his own lawyers and the government about his plans to return and secretly moved million overseas.Alexander, 64, an Israeli citizen who founded digital voicemail pioneer Comverse in 1982, returned last year to plead guilty to securities fraud after fleeing to Namibia in 2006 to evade prosecution for backdating stock options and trying to bribe an underling to take the fall. Alexander claimed in a letter to the judge that he fled out of fear of a draconian sentence for a white-collar crime and fought extradition for a decade because he was “terrified” by seeing his name on a Most Wanted list with Osama bin Laden. He was also charged with obstruction for offering another executive a bribe to take responsibility for the scheme.
Although Alexander never cashed in his options, prosecutors said the scheme cost the company .8 million and led to its delisting as a publicly traded company, reducing the market capitalization by 0 million.A very long ten years ago – before the financial crisis, before the Euro crisis, before the Brexit vote — there was the options backdating scandal.The wave of litigation the scandal stirred up took its time to work its way through the system, but eventually the litigation was resolved and the scandal moved into the past.His luxury townhouse was adjacent to a private airstrip, even though a Namibian judge had restricted his travel and Alexander theoretically faced certain arrest if he left the country.By then, Alexander had pledged millions of dollars — lavish by Namibian standards — in aid to Namibian schoolchildren and new housing for the nation's impoverished townships. accused Alexander of using Comverse shareholder money to buy off the Namibian government, which his Namibian attorney flatly denied.Alexander's former company, Comverse Technology, which in turn will use it to settle shareholder lawsuits related to the backdating scandal. Settlement Letter from Jacob Alexander This is a more complete version of the story than the one that appeared in print.He has also agreed to pay a million fine to the Securities and Exchange Commission. Alexander went to Namibia in 2006 after authorities accused him and two other former Comverse executives of giving themselves backdated stock options and setting up a secret ''slush fund'' to hand out backdated options to favored employees. Alexander, an Israeli citizen known as Kobi, continues to fight his extradition. The settlement, announced Tuesday, returns the money to Mr.Defense lawyer Ben Brafman said he lived a modest lifestyle and gave generously to needy Namibians.Brafman urged a term of just 18 to 24 months, insisting Alexander returned “voluntarily” to face charges, but Garaufis called that claim laughable.Alexander has remained in Namibia long after his fellow former executives got out of prison, reportedly flying in 200 guests for his son's bar mitzvah in 2008.Coming to Terms But Alexander did not ignore his looming legal problems in the U. He eventually settled multiple lawsuits brought by Comverse shareholders.