Fugitive Comverse CEO back in Namibian court

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October 2, 2006 23:46
3 minute read.

Fugitive Israeli businessman Jacob "Kobi" Alexander accused in the US in a multimillion-dollar stock manipulating scheme told a Namibian court Monday he had entered the country legally and wanted to invest there. He was arrested there on September 26 after a two-month international manhunt. Alexander, the former chief executive of New York-based voice mail software maker Comverse Technology Inc., was arrested in the Namibian capital Windhoek at the request of the FBI. Alexander helped found Comverse in Israel in the early 1980s before moving its headquarters to New York's Long Island. A significant amount of Comverse research and development is based in Israel. A bail hearing began Monday in a Namibian court and will continue Tuesday. The Namibian government opposed bail pending a formal extradition request form the United States, Justice Ministry official Dennis Khama said. The US has 30 days to lodge a formal extradition request. US Attorney Roslynn Mauskopf said last week she would seek Alexander's swift extradition to face charges in federal court in Brooklyn. In an affidavit filed with the court, Alexander, 54, said he had been living in the desert country with his wife and three children since July and had transferred almost $16 million from Israel to Namibian commercial banks. "While in Namibia I have used my own name openly and publicly in all my encounters and ventures with government officials and private individuals alike. "I entered Namibia openly and lawfully, and I have not in any manner tried to hide my whereabouts from anyone," he said. Alexander, who has a two-year permit to live and work in Namibia, stays in a $500,000 home he purchased on the Windhoek Country Club Estate. His children attend the city's international school. According to his statement, he has invested a further $1.5m. in several business ventures in Namibia with local partners. He has purchased of a number of properties and invested in a debt-ridden auto body shop. He said he also planned to develop low-cost housing. "I am in the process of negotiating and considering various other business opportunities concerning low cost housing and tourism. I have invested substantially in the Namibian economy... with a view to engaging previously disadvantaged Namibians," he said. Authorities began hunting for Alexander in late July shortly before a criminal complaint was unsealed accusing him and two other former top executives of fraud. Before he disappeared, Alexander allegedly transferred millions to Israel. Much has been made in the Namibian press about the fact that Alexander was arrested on the same day that the order allowing extraditions from Namibia to the US was made public. In his affidavit, Alexander, who says he is not a citizen of the US or the holder of an American passport, claims that the warrant for his arrest was "irregularly issued" and invalid. He claims correct procedures were not followed, saying that the US attorney had no standing to request his arrest in Namibia and that he "did not commit any crimes in this jurisdiction." Alexander only briefly referred to "the highly technical charges" against him in the US, saying that he intended to plead not guilty. The Namibia Press Agency reported that the state opposed bail because of concerns Alexander would flee the country before the extradition request reached Namibian authorities. Marlene Williams, an FBI agent based in South Africa, also opposed bail. It is alleged that from 1991 through 2005, Alexander exercised options and sold stocks worth approximately $150m., making a $138m. profit. Of that, about US$6.4m. was allegedly generated by illegally backdating options. Two other defendants, former finance chief David Kreinberg and former senior general counsel William Sorin, surrendered in August and were released on $1m. bond each. A complaint unsealed in US federal court accuses the three men of making stock options more lucrative by backdating their exercise price to a low point in the stock's value. Usually, a stock option's exercise price coincides with the market value at the time of a grant to give the recipient an incentive to drive the price higher. Prosecutors allege the two other defendants earned about $1m. each on backdated options. In addition, the company awarded thousands of stock options to fictional employees, then secretly transferred the awards to an internal account under the name I.M. Fanton, which stood for phantom, court papers said. The scheme allowed Alexander to award those options to real "favored employees" and to himself, without board of directors approval, the papers added. Comverse Technology is headquartered in Woodbury, New York, giving Brooklyn prosecutors jurisdiction over the case.


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