Feeds

Ex-Comverse chief turns fugitive

Options backdated by a one-armed man?

High performance access to file storage

Former Comverse CEO Jacob "Kobi" Alexander, 54, has become the target of a worldwide manhunt.

He disappeared after being charged with fraud for a role in the firm's stock options scheme.

A warrant for his arrest was issued last week when Department of Justice officials in Brooklyn, NY, charged him and two former colleagues - Comverse CFO David Kreinberg and former general counsel William F Sorin - with conspiracy to commit securities fraud, mail fraud, and wire fraud.

Kreinberg and Sorin were arraigned in federal court and and granted bail for $1m each.

Alexander's lawyer told Bloomberg: "I've been in Hawaii. He's not in Hawaii. The last time I talked to him, he talked to me from Israel, three weeks to a month ago."

Alexander has dual American-Israeli citizenship. An Interpol notification for his immediate arrest has been issued.

The trio resigned from Comverse, the world's largest voicemail software provider, on 1 May in the midst of an internal investigation into stock option grants. Investigators accuse them of profiting from backdating options and making misleading public financial statements between 1998 and 2002.

US Attorney Roslynn Mauskopf said: "By backdating these options, the defendants, in effect, gave themselves and others an opportunity to place a bet in the middle of a race - a bet that paid off handsomely."

The DOJ's statement on the case is here.

Prosecutors also allege Alexander transferred $57m out of the US to accounts in Israel, in a "money laundering scheme". They were able to seize $45m left in US accounts.

The Comverse charges were the second to arise from the ongoing SEC probe into backdating. Alexander is the first exec to turn fugitive. Former Brocade CEO Greg Reyes is battling his case going to trial in San Francisco.

The ever-deepening stock options investigations have led one Silicon valley bigwig to describe it as a "witchhunt". NetApp CEO Daniel Warmenhoven told Business Week: "I think the government is looking to find some egregious examples [of wrongdoing] and to publicly hang people for them. That's fine. But where does it stop?

"I'm not saying the past practices were all good. But I thought the SEC's role was to build investor confidence. What they're doing right now is destroying it, and I don't see the purpose." The full interview is here. ®

High performance access to file storage

More from The Register

next story
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
France bans managers from contacting workers outside business hours
«Email? Mais non ... il est plus tard que six heures du soir!»
prev story

Whitepapers

Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
HP ArcSight ESM solution helps Finansbank
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.