TODAY'S PAPER
42° Good Afternoon
42° Good Afternoon
Business

Comverse admits 'improper' acts, pays $2.8M

Jacob

Jacob "Kobi'' Alexander, the former chief of Comverse Technology Inc., waits for proceedings to begin in the magistrates court. (July 9, 2007) Photo Credit: Bloomberg News File, 2007

Comverse Technology Inc., a Manhattan software company with deep Long Island roots, has avoided prosecution under the Foreign Corrupt Practices Act by agreeing to pay a $2.8 million penalty to two federal agencies. 

It must pay $1.2 million to the Justice Department and $1.6 million to the Securities and Exchange Commission. 

The case against Comverse centered on $536,000 in improper payments to officials of a Greek telecomm company, OTE, from 2003-2006. In exchange OTE agreed to buy services from Comverse, officials said. 

Comverse is the majority owner of Verint Systems Inc., a Melville security software company.  A company spokesman was not immediately available for comment Thursday.

Long based in Woodbury, Comverse under former chief executive Jacob  Alexander grew into a billion-dollar corporation specializing in software for voice communications, Newsday has reported. The Comverse headquarters was moved to Manhattan in 2005. 

Along with paying the $2.8 million penalty, Comverse had to accept responsibility for falsely recording in an Israeli subsidary's ledgers that the $536,000 in payments were legitimate. 

“The agreement recognizes the company’s thorough self-investigation and the results of its investigation, voluntary disclosure of the underlying conduct, and full cooperation with the department,” a Justice Department news release said. 

The company “has also undertaken extensive remedial efforts and overhauled its overall compliance culture…” Justice said. 

The repercussions of Alexander’s alleged accounting misdeeds, which included backdating options, continued to be felt last month when Comverse replaced its chief executive. 

Alexander, who is also known as Kobi, fled to the southwestern African nation of Namibia, and still faces federal criminal charges of conspiracy, wire fraud, money laundering and obstruction of justice.

Photo: Jacob "Kobi" Alexander

Comments

We're revamping our Comments section. Learn more and share your input.

More news