The US Federal Bureau of Investigation (FBI) declared Comverse Technology (Nasdaq: CMVT) founder Kobi Alexander a fugitive yesterday, and asked the public to help find him. Alexander faces a criminal indictment for alleged manipulation of stock option allocations.
Reuters reports that, in July, the FBI relayed Alexander's details to Interpol. Alexander holds dual US-Israeli citizenship. No response was reported from Alexander's lawyer, who was quoted yesterday as saying that he did not know of his client's whereabouts.
Alexander is not the only former Comverse Technology manager who stands accused in the options backdating affair. Indictments have also been filed against former VP finance David Kreinberg and former corporate secretary and director William Sorin. The two have been released on bail.
Alexander, Kreinberg, and Sorin resigned from Comverse Technology in May, when the company announced that it had begun an internal investigation into options allocations.
Over 100 companies listed in the US are examining their options allocation practices. The suspicion is that these companies falsely dated option allocations to employees with dates on which their share prices were low, so that the exercise price of the options would be similarly low, enabling the recipients to make improper gains.
The US Justice Department has seized more than $45 million from two investment accounts in Alexander's name, and claims that he was involved in "a money laundering scheme involving the secret transfer of more than $57 million to accounts in Israel."
Published by Globes [online], Israel business news - www.globes.co.il - on August 16, 2006
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