Comverse options backdating
The settlements included the first fines to stem from such cases— million for Mercury Interactive and million for Brocade.In the Brocade case, the SEC said that the company committed fraud through the actions of former CEO Gregory L.Alexander fled to Namibia with his family in July 2006 amid the investigation, prosecutors said. Charges were announced that August against himself, William Sorin, Comverse’s general counsel, and David Kreinberg, its finance chief. He settled related civil government lawsuits in 2010, resulting in a million penalty by the U.
Alexander, who became a fugitive from the FBI when he allegedly fled the U. for Namibia, where he is living today, filed a law suit separate from Sorin’s suit against Deloitte in federal District Court in Brooklyn, N. In the complaints, Alexander and Sorin said that if they are held liable in the backdating case, Deloitte & Touche should bear some responsibility for damages, according to Knight Ridder/Tribune.
Alexander’s lawyers noted that “The charges relate to the disclosure and accounting treatment of the options,” noted Bloomberg.
The attorneys compared the case to that of Apple’s chief executive Steve Jobs, who was cleared by the Securities and Exchange Commission of backdating, added Bloomberg.
“Alexander is neither a lawyer nor an accountant,” reiterated the attorneys. Sorin, former general counsel of Comverse, became the first executive involved in the stock-option backdating scandal to be sentenced to prison.
Sorin, who last November pleaded guilty to a single criminal count of conspiracy to commit securities fraud, mail fraud, and wire fraud, was sentenced to one year and one day in prison, plus three years’ supervised release. Last July, reported that there is no statute that explicitly outlaws backdating stock-option grants.
Between 19, Alexander and his co-conspirators engaged in a fraudulent options backdating scheme to select the best issuance date of Comverse stock options, which they awarded to themselves and other Comverse employees.